- EUR / USD is posting modest daily losses on Wednesday.
- The US dollar index is struggling to extend its rally.
- Private sector employment in the US increased more than expected in January.
The pair EUR/USD it spent the first half of the day in a relatively tight range around 1.2050, but was under renewed downward pressure ahead of the US session. At the moment, the pair is consolidating its daily losses at 1.2022, losing 0.16% on the day.
The euro struggles to find demand since the beginning of the week
Hours earlier, data released by Eurostat showed that the Basic Consumer Price Index in January jumped to 1.4% from 0.2% and beat the market’s expectation of 0.9%. However, this report had little to no impact on the performance of the shared currency against its rivals and the USD market valuation continued to drive the movements of the EUR / USD.
The US Dollar Index (DXY) extended its rally and touched its highest level in two months at 91.30 during European trading hours, but lost its momentum.
US data revealed that ISM’s services PMI jumped to its highest level in two years at 58.7 in January and beat the market expectation of 56.8. Additionally, the Automatic Data Processing Research Institute (ADP) reported that private sector employment in the US increased by 174,000, compared with an analyst estimate of 49,000.
Following the release of bullish data, the DXY lost its traction and was last seen shedding 0.06% on the day at 91.14, allowing the EUR / USD to limit its losses.
On Thursday, euro zone retail sales data will be analyzed for further momentum ahead of the weekly report of initial jobless claims from the US Department of Labor.