- On Tuesday, the EUR/USD is expected to encounter fresh selling pressure due to increased demand for the US dollar.
- Concerns regarding US financial stability and potential Federal Reserve rate cuts could cap the US dollar’s gains, thereby bolstering major currencies.
- The European Central Bank’s somewhat hawkish stance might lend support to the euro, attracting bullish interest.
The EUR/USD pair is finding it hard to consolidate above the previous day’s high, facing new sellers around the 1.1435 mark during the Asian session on Tuesday. A noticeable uptick in US dollar demand has pushed spot prices back below the psychological threshold of 1.1400 recently.
A robust US Non-Farm Payroll (NFP) report released last Friday has dampened expectations for an imminent interest rate cut by the Federal Reserve this year. Moreover, the renewed optimism surrounding US-China trade talks led some traders to scale back their USD positions, adding further pressure on the EUR/USD pair. However, with negotiations extending into a second day in London, it seems traders are holding back on making aggressive directional decisions.
Traders appear to be increasingly anticipating a reduction in borrowing costs by the US central bank in September, which may further weaken the US dollar and act as a tailwind for the EUR/USD pair, especially considering concerns over the fiscal health of the US government. In contrast, the European Central Bank (ECB) hinted at stopping interest rate cuts in their recent meeting, which could lead to further gains for the euro and limit currency pair losses.
As the US inflation data release looms this week, traders might be cautious about making significant moves. It seems sensible to wait for more decisive sales before looking to extend the recent pullback from near the critical level of 1.1500, the highest point since April 22nd last week. Without relevant macroeconomic updates from the Eurozone or the US, the EUR/USD pair remains sensitive to US dollar price dynamics.
Today’s US Dollar Price
The table below displays various currency exchange rates against the US dollar (USD), which, notably, has shown strength against the Japanese yen.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.22% | 0.10% | 0.25% | 0.04% | -0.02% | 0.14% | 0.14% | |
| EUR | -0.22% | -0.10% | 0.02% | -0.14% | -0.21% | -0.07% | -0.05% | |
| GBP | -0.10% | 0.10% | 0.04% | -0.04% | -0.11% | 0.04% | 0.06% | |
| JPY | -0.25% | -0.02% | -0.04% | -0.17% | -0.29% | -0.17% | -0.18% | |
| CAD | -0.04% | 0.14% | 0.04% | 0.17% | -0.08% | 0.08% | 0.10% | |
| AUD | 0.02% | 0.21% | 0.11% | 0.29% | 0.08% | 0.17% | 0.17% | |
| NZD | -0.14% | 0.07% | -0.04% | 0.17% | -0.08% | -0.17% | 0.02% | |
| CHF | -0.14% | 0.05% | -0.06% | 0.18% | -0.10% | -0.17% | -0.02% |
This heatmap illustrates the rate of change between major currencies. You can select a base currency from the left column and see how it compares to currencies along the top row. For instance, selecting US dollars and then moving to the Japanese yen will show you the rate of change for USD/JPY.
