EUR/USD surges on dovish Fed comments, weak US data

The EUR/USD reaches 1.0746, surging over 0.50% from its opening price, following a weekly low of 1.0635. Weakening US manufacturing activity, as indicated by the ISM Manufacturing PMI falling to 46.9 in May, fuels speculation of a Fed pause on tightening.

Mixed employment data shows private hiring surging but falling short of April’s numbers, while Initial Jobless Claims indicate a tight labor market.

EUR/USD shifted gears after printing a weekly low of 1.0635, climbs bolstered by dovish Fed officials’ comments, alongside soft economic data from the United States (US). Therefore, investors looking towards a less hawkish Fed dumped the dollar in favor of riskier assets. At the time of writing, the EUR/USD exchanges hands at 1.0746, more than 0.50% above its opening price.