The EURUSD pair remains pressured after snapping two-day uptrend, consolidates previous weekly gains.
The pair failed to extend the previous week’s recovery moves, down 0.11% intraday around 1.1920, heading into Monday’s European session. The slow-moving market fails to tame the pair sellers as fresh fears of inflation and the coronavirus (COVID-19) favor the US dollar’s demand, due to its risk-safety allure.
That said, the US dollar index (DXY) prints the strongest intraday gains in over a week, up 0.07% on a day around 91.88, by the press time.
US Core Personal Consumption Expenditures (PCE) Price Index, published Friday, seems to be the main facilitator behind the US Dollar’s recovery moves. The Fed’s favorite indicator of Inflation jumped to the highest in the near three decades with 3.4% YoY figures in May and probed the Fed’s sustained repeated efforts to tame inflation fears and chatters over rate hikes, as well as tapering.
Following the US Core PCE release, Minneapolis Federal Reserve President Neel Kashkari said, “Expecting to see some of the very high inflation readings to return back down to normal.” On the contrary, Boston Federal Reserve President Eric Rosengren said on Friday that they have to think about some of the side effects of a low-for-long interest rate strategy, as reported by Reuters.
So, the EURUSD is expected to continue trading bearish as volumes and volatility is expected to increase on the Friday US NFP Unemployment figures.
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