EUR/USD hangs near two-month low, seems vulnerable below mid-1.0900s ahead of US CPI
Trending Articles- Iranian military drones targeted US Fifth Fleet in Bahrain in response to southern US strikes
- Gold plummets below $4,200 as US‑Iran tensions spur hawkish rate bets ahead of US CPI
- Gold Price Trend Forecast: US-Iran Peace Talks Drive Gold Rebound, Is the Gold Slump Over?
- SpaceX Listing Imminent. Funds Flood Into SpaceX On-Chain Tokens, Bitcoin Rebound Momentum May Be Weakened
- US May CPI Preview: Rising Inflation May Push Up Fed Rate Hike Expectations, How Will US Stocks, Dollar, Gold React?
- Gold Drops Below $4,300 Erasing Year-to-Date Gains. This Week’s CPI May Ignite Rate Hike Expectations Will Gold Still Rise in 2026?
EUR/USD struggles to attract any meaningful buyers amid a bullish USD.
The fundamental backdrop seems tilted firmly in favor of bearish traders.
Investors await the release of the US CPI report before placing fresh bets.
The EUR/USD pair oscillates in a narrow band below mid-1.0900s during the Asian session on Thursday and consolidates the recent heavy losses to a nearly two-month low touched the previous day.
The US Dollar (USD) stands tall near its highest level since August 16 as traders have priced out the possibility of another 50 basis points (bps) interest rate cut by the Federal Reserve (Fed) in November. Moreover, the current market pricing indicates over a 20% chance that the US central bank will keep rates on hold next month and the expectations were reaffirmed by hawkish FOMC minutes released on Wednesday. This keeps the yield on the benchmark 10-year US government bond elevated above the 4% threshold, which should underpin the buck and act as a headwind for the EUR/USD pair.
The shared currency, on the other hand, continues to be weighed down by growing acceptance that the European Central Bank (ECB) will lower borrowing costs by 25 bps at each of the two policy meetings by the year-end. Moreover, the risk of a further escalation of geopolitical tensions in the Middle East should benefit the safe-haven Greenback and suggest that the path of least resistance for the EUR/USD pair is to the downside. Traders, however, might refrain from placing fresh bearish bets and prefer to wait for the latest US inflation figures before positioning for a further depreciating move.
The crucial US Consumer Price Index (CPI) is due for release later during the North American session this Thursday and will be followed by the US Producer Price Index (PPI) on Friday. The data will play a key role in influencing expectations about the Fed's rate-cut path, which, in turn, will drive the USD demand in the near term and provide a fresh directional impetus to the EUR/USD pair.
Read more
* The content presented above, whether from a third party or not, is considered as general advice only. This article should not be construed as containing investment advice, investment recommendations, an offer of or solicitation for any transactions in financial instruments.
