EUR/USD edges lower after marking 1.1830, the highest since September 2021
US ISM Manufacturing PMI climbed to 49.0 from 48.5 in May, against the expected 48.8.
EU Commissioner Maros Sefcovic is expected to meet with US trade officials to advance the ongoing tariff negotiations.
EUR/USD halts its winning streak that began on June 18, trading around 1.1800 during the Asian hours on Wednesday. The pair inches lower after marking 1.1830, the highest since September 2021, recorded on Tuesday, which could be attributed to the slight gains in the US Dollar (USD).
The US Dollar Index (DXY), which measures the value of the US Dollar against six major currencies, is halting its losing streak that began on June 19 and is trading around 96.70 at the time of writing. The Greenback gains ground as the latest data indicated that economic activity in the United States (US) manufacturing sector improved in June.
US ISM Manufacturing PMI advanced to 49.0 from 48.5 in May, coming in above experts' expectations of 48.8. Moreover, US JOLTS Job Openings rose to 7.76 million in May, compared to 7.395 million openings reported in April. This figure came in above the market expectation of 7.3 million. Traders will likely observe the US ADP Employment Change report for June later in the day.
Fed Chair Jerome Powell highlighted on Tuesday that the US central bank will gauge more data before it initiates monetary policy easing, but he did not rule out a rate reduction in the July meeting. US Treasury Secretary Bessent told Fox News that he believes the Federal Reserve will cut interest rates earlier than the fall, but they will definitely cut rates by September at the latest.
The preliminary figures showed Eurozone inflation came in at 2% as expected, staying at the European Central Bank’s (ECB) target band. Meanwhile, ECB Chief Economist Philip Lane noted that the central bank’s recent tightening cycle has concluded.
The European Union (EU) is willing to accept a deal involving a 10% universal tariff on many of its exports, but is seeking US concessions on key sectors such as pharmaceuticals, alcohol, semiconductors, and commercial aircraft. The EU Commissioner Maros Sefcovic would travel to Washington to meet with US Trade Representative Jamieson Greer and Commerce Secretary Howard Lutnick in an effort to push the tariff talks forward, per Bloomberg.
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