EUR/USD is back under 1.1000 as hawkish Fed speak and energy price gains weigh.
Coming up, Fed speakers will remain in focus alongside geopolitics and March flash PMIs on Thursday.
EUR/USD has subsided back to sub-1.1000 levels for a second successive session having again been unable to break above its 21-Day Moving Average which currently resides near the 1.1050 mark. At current levels in the 1.0980s, the pair is trading lower by about 0.4% on the session and eyeing a test of weekly lows posted on Tuesday in the 1.1060 area, as traders digest the latest batch of commentary from Fed policymakers. Cleveland Fed President Lorretta Mester become the latest of a growing throng of FOMC members to announce support for potential 50bps rate hikes at upcoming meetings and FX strategists think the ongoing hawkish shift in market expectations for Fed tightening in the coming year is providing ongoing support to the US dollar.
Energy prices have also turned higher amid fiery rhetoric from Russian Foreign Minister Sergey Lavrov and further signs that Russo-Ukrainian peace talks are at a deadlock, coupled with fears about Russian exports. This is weighing on the euro and contributing to its relative underperformance on Wednesday versus most of its G10 peers. Coming up, Fed speakers remain in focus for the rest of the week and further hawkish leanings could continue to weigh on EUR/USD, perhaps tilting it towards last week’s near-1.0900 lows. Eurozone and US flash March PMIs will also be in focus on Thursday and will give an early insight as to how the Russo-Ukraine war has impacted business sentiment.
EUR/USD falls below 1.1000 as dollar regains its strength EUR/USD extended its slide during the European trading hours and was last seen trading below 1.1000. The renewed dollar strength on the risk-averse market environment is weighing heavily on the pair on Wednesday. Wall Street’s main indexes remain on track to open in the red.
EUR/ USD News
GBP/USD stays on the back foot, falls below 1.3200.GBP/USD continues to push lower in the early American session and trades deep in negative territory below 1.3200. The data from the UK showed that annual CPI jumped to a three-decade high of 6.2% in February from 5.5% in January.
Gold climbs back above $1,930 level amid cautious market mood.Gold regained traction on Wednesday amid the lack of progress in the Russia-Ukraine peace talks. The Fed’s hawkish outlook, elevated US bond yields could act as a headwind for the precious metal.