- EUR/USD is likely to attract additional buyers on Thursday.
- Weaker US CPI boosts expectations for a rate cut from the Fed while trade concerns linger.
- Overall conditions appear favorable for bullish traders as attention turns to US PPI reports.
The EUR/USD pair is continuing its upward trend and could reach the 1.1530 level, marking its highest point since April 22nd, during the Asian session on Thursday. The background seems to favor bullish traders, indicating that the easiest route for prices may be upward.
The US Dollar is poised to test its monthly low as the Federal Reserve is expected to resume its rate-cutting cycle in September, a prediction supported by softer consumer inflation data released on Wednesday.
In addition, President Trump mentioned on Wednesday that he plans to impose unilateral tariffs soon and will reach out to his trading partners through a letter. His remarks add uncertainty, overshadowing some optimism about US-China discussions regarding a Geneva consensus aimed at easing trade tensions.
At the same time, the euro is being buoyed by a hawkish signal from the European Central Bank, suggesting that the cycle of rate cuts may be nearing its end. This adds to the positive sentiment surrounding the EUR/USD pair and is seen as a factor supporting its short-term outlook, despite the lack of new economic data from the eurozone.
The US economic agenda includes a producer price index (PPI) report and weekly initial unemployment claims. This data could influence the USD’s performance and impact the EUR/USD pair. However, any positive response from the US dollar might be brief. Overall, the supportive conditions suggest further evaluation of the pair’s movements is likely.
