EUR/USD looks indecisive around the 0.9700 zone on Wednesday..The buying interest dwindles somewhat around the European currency and motivates EUR/USD to give away initial gains and put the 0.9700 area to the test on Wednesday.
EUR/USD focuses on ECB, FOMC.EUR/USD meets some obstacles following Tuesday’s humble advance in spite of the renewed weakness in the greenback and the firmer note in the risk-associated universe.
The pair’s inconclusive price action comes in tandem with a marginal uptick in the German 10-year bund yields, which flirt with the 2.34% region vs. the broad-based loss of momentum in their American peers.Later in the session, Chair Lagarde will participate in the G20 Finance Ministers and Central Bank Governors meeting and in the 2022 IIF Annual Membership Meeting.
In the domestic calendar, Industrial Production in the euro area expanded 2.5% YoY for the month of August.Across the pond, MBA Mortgage Applications and Producer Prices will be in the limelight ahead of the publication of the FOMC Minutes of the September gathering.
What to look for around EUR
EUR/USD looks to consolidate the recent breakout of the 0.9700 hurdle midweek.In the meantime, price action around the European currency is expected to closely follow dollar dynamics, geopolitical concerns and the Fed-ECB divergence. Following latest results from key economic indicators, the latter is expected to extend further amidst the ongoing resilience of the US economy.
Furthermore, the increasing speculation of a potential recession in the region – which looks propped up by dwindling sentiment gauges as well as an incipient slowdown in some fundamentals – adds to the sour sentiment around the euro
EUR/USD levels to watch
So far, the pair is losing 0.02% at 0.9704 and a breach of the monthly low at 0.9669 (October 11) would target 0.9535 (2022 low September 28) en route to 0.9411 (weekly low June 17 2002). On the upside, the initial hurdle comes at 0.9999 (weekly high October 4) followed by 1.0050 (weekly high September 20) and finally 1.0197 (monthly high September 12).
GBP/USD recaptures 1.1000 amid UK policy uncertainty, subdued USD
GBP/USD is recovering ground above 1.1000 during the European trading on Wednesday. Investors assess reports floating around the BOE and UK PM Truss’ policies. The US dollar eases amid a mixed sentiment, ahead of US data and Fed minutes.
EUR/USD eases to 0.9700 ahead of US data, Lagarde
EUR/USD is battling 0.9700, erasing gains amid a broadly subdued US dollar, Treasury yields and a cautious market mood. EUR bulls ignore upbeat Eurozone Industrial Production data. The focus shifts to Lagarde’s speech, US inflation data and Fed minutes.
USD/JPY: Upside regains traction above 146.00, at highest since 1998
USD/JPY is seeing fresh demand and refreshes 24-year highs above 146.40. Investors trade with caution, as the pair has surpassed the key 145.90 level, which was previously a trigger point for the Japanese intervention. The US dollar holds steady ahead of Fed minutes.