EUR/USD drops to multi-day lows

The US dollar gains momentum during the US trading session whereas the Euro records fresh lows versus the dollar, the Swiss Franc and British pound.

Stocks have erased some gains in Wall Street. The EUR/USD pair dropped further and bottomed at 1.0501, the lowest level since Thursday. It then trimmed losses, rising to 1.0530. The move lower took place against the US dollar that has gained momentum.

The US dollar surged as Wall Street indexes turned negative. The Dow Jones is falling by 0.51% and the Nasdaq by 1.74%. US yields pulled with the US 10-year at 3.20% and the 30-year at 3.31%.

US economic data are below expectations. The Conference Board’s Consumer Confidence Index dropped to 98.7 in June, the lowest level in 16 months. The Richmond Fed Manufacturing Index tumbled to -19 in June from -9, against market consensus of -11. The S&P/Case Shiller Price Index rose 1.6% in April. The numbers did not affect the dollar.

The Euro is among the worst performers during the current US session. EUR/CHF dropped to test last week’s lows near 1.0050 and EUR/GBP pulled back to 0.8620. The common currency did not benefit from hawkish comments by European Central Bank officials.

The annual ECB forum in Portugal will have its last day on Wednesday. A discussion panel will include Lagarde, ECB President, Fed Chair Jerome Powell and BoE’s Baily.

The EUR/USD moved off lows and is back above 1.0530. The pair will likely continue to move sideways between 1.0500 and 1.0600. Earlier on Tuesday the euro traded above 1.0600 but again it was rejected from those levels; it needs to consolidate above those levels to open the doors to more gains.