Euro advances toward 1.1200 as US Dollar retreats, US CPI looms

Source Fxstreet
  • Euro climbs toward 1.1200 as the US Dollar weakens amid falling Oil prices.
  • Trump downplays renewed strikes on Iran as diplomatic efforts continue.
  • Fed and ECB rate hike expectations remain in focus amid persistent inflation risks.

EUR/USD trades on the front foot on Monday as the US Dollar (USD) softens alongside Oil prices, with traders weighing the latest diplomatic developments between the US and Iran. At the time of writing, the pair trades around 1.1203, up 0.55% on the day.

US President Donald Trump played down the likelihood of renewed strikes on Iran. Qatar’s prime minister is in Washington, DC, for talks with President Donald Trump and Vice President JD Vance on efforts to end the conflict. West Texas Intermediate (WTI) trades around $86.85 a barrel, down more than 3% on the day.

Though a diplomatic breakthrough remains uncertain. Tehran says progress towards peace depends on Washington lifting its naval blockade, releasing seized assets and lifting sanctions. Without progress in the talks, Oil prices may struggle to sustain their decline, keeping inflation risks in focus in both the US and the Eurozone.

In the US, resilient economic growth and a firm labour market give the Federal Reserve (Fed) room to raise interest rates further as policymakers seek to bring inflation back to their 2% target.

US Nonfarm Payrolls (NFP) rose by 165K in October, more than double the 65K forecast, while the Unemployment Rate edged down to 4.1%. Traders price in roughly an 80% chance of a December hike, according to the CME FedWatch Tool. This week’s US inflation data could shift those expectations and drive the Dollar’s next move. The Consumer Price Index (CPI) is due on Tuesday, followed by the Producer Price Index (PPI) on Friday.

The US Dollar Index (DXY), which tracks the Greenback against a basket of six major currencies, trades around 101.85, down 0.44% on the day.

In the Eurozone, traders also expect the European Central Bank (ECB) to raise rates in December. The ECB held its deposit rate at 2.50% in October after raising it by a cumulative 50 basis points (bps) earlier this year. Policymakers remain cautious about further tightening as they weigh the risk of higher inflation against the prospect of weaker growth.

Eurozone headline inflation rose to 4.0% YoY in October from 3.8% in September, driven largely by higher energy costs, while core inflation held steady at 2.5%.

US Dollar Price Today

The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Swiss Franc.

USD EUR GBP JPY CAD AUD NZD CHF
USD -0.55% -0.49% -0.32% 0.00% -0.64% -1.32% 0.10%
EUR 0.55% 0.06% 0.27% 0.55% -0.09% -0.77% 0.65%
GBP 0.49% -0.06% 0.21% 0.48% -0.17% -0.83% 0.58%
JPY 0.32% -0.27% -0.21% 0.29% -0.35% -1.02% 0.39%
CAD -0.00% -0.55% -0.48% -0.29% -0.65% -1.30% 0.10%
AUD 0.64% 0.09% 0.17% 0.35% 0.65% -0.67% 0.75%
NZD 1.32% 0.77% 0.83% 1.02% 1.30% 0.67% 1.43%
CHF -0.10% -0.65% -0.58% -0.39% -0.10% -0.75% -1.43%

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).

Disclaimer: For information purposes only. Past performance is not indicative of future results.
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