- EUR/USD picks up above 1.1800 after an 1.5% sell-off in the previous two trading days.
- News of a trade deal with India and upcoming talks with Iran are supporting the US Dollar.
- A partial US government shutdown will delay key US labour data scheduled for this week.
The Euro (EUR) edges higher against the US Dollar (USD) on Tuesday, trading at 1.1815 at the time of writing after bottoming at 1.1776 the previous day. Strong manufacturing data in the US and news of a trade deal between the US and India provided additional support to the US Dollar on Monday and eased concerns about a partial US government shutdown.
US President Donald Trump announced a deal with India that will reduce tariffs on Indian products to 18% from the current 50%. Beyond that, Iran’s president, Masoud Pezeshkian, said on Tuesday that Tehran will start nuclear negotiations with the US, which has contributed to easing tensions in the region, and provided additional support to the Greenback.
Macroeconomic data was also US Dollar supportive on Monday. The US ISM Manufacturing Purchasing Managers’ Index (PMI) improved beyond expectations, offsetting concerns about a partial government shutdown that will delay Friday’s Nonfarm Payrolls (NFP) report.In the economic calendar on Tuesday, the European Central Bank (ECB) Lending Survey will provide further insight about credit conditions in the Eurozone, while in the US, the focus will be on the Federal Reserve (Fed) Governor Michelle Bowman’s speech
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