- The EUR/USD pair will end the week above 1.0600 after hitting a weekly low of 1.0533.
- Boosting risk appetite and falling US bond yields put a headwind for the dollar.
- US ISM Non-Manufacturing data showed that the US economy remains resilient.
The pair EUR/USD reversed course and is set to end the week with gains of more than 0.80% on a softer US dollar (USD) amid speculation that the US Federal Reserve (Fed) would not raise rates further than what money market futures expect. The EUR/USD pair is trading at 1.0635, after marking a daily low of 1.0588.
EUR/USD pared losses on Wednesday as investors played down hawkish Fed comments
US stocks are poised to end the week with gains. The US Dollar Index (DXY), which measures the value of the dollar against a basket of currencies, fell back from 2.5-month highs to 104,526, after US data reaffirmed the strength of the US economic situation.
Business activity in the US improved, as shown by the US ISM Non-Manufacturing PMI for February, which came in at 55.1, one point down from 55.2 in the previous month, but above expectations of 54.5, indicating that business activity remains strong. The price index subcomponent, which investors look to for clues on inflation, rose to 65.5, beating estimates of 64.5 but below January data.
Meanwhile, Federal Reserve officials such as Fed Governor Michelle Bowman and Dallas Fed President Lorie Logan did not comment on monetary policy. Boston Fed President Susan Collins commented that inflation is still too high, adding that
Apart from this, the Eurozone (EU) revealed that the S&P Global Services and Composite PMIs were above previous readings. Meanwhile, inflation figures announced on Thursday came in below last month’s data but above estimates, one reason for the ECB to keep raising interest rates.
Although the figures were higher than expected, investors had already discounted a 50 basis point rate hike by the European Central Bank (ECB), as announced by its president, Christine Lagarde, in her last press release. meeting. However, the latest data has divided ECB officials on the signal the bank should send to the markets.
EUR/USD Technical Levels
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
