Powell\u2019s Testimony is being awaited and eyed amid market talk over the longevity of Fed\u2019s 75 bps rate hike. The EUR\/USD pair holds onto the previous two-day gains around 1.0535-40 during Wednesday\u2019s initial Asian session.
The pair\u2019s latest rebound could be linked to the softer US dollar, as well as hawkish comments by the ECB policymaker. However, cautious sentiment ahead of Fed Chair Jerome Powell\u2019s Testimony, before the Congress, restricts immediate price moves.
ECB\u2019s Olli Rehn said on Tuesday, \u201cit is very likely that September rate hike is bigger than 25 bps\u201d. Rehn\u2019s comments raised doubts about the ECB\u2019s latest verdict suggesting a 0.25% rate hike in July and September, which in turn propels the EUR\/USD prices.
Fed\u2019s Barkin said on Tuesday that there will be no rapid return for the U.S. economy to the experience of the previous decade of stable growth, jobs and inflation. The policymaker also favored higher rates. US President Joe Biden\u2019s firm rejection of the recession fears seems to gain the market\u2019s acceptance and underpin the firmer sentiment amid a lack of major negatives as the US traders began the trading week.
After Biden\u2019s remarks, his Economic Aide Heather Boushey also conveyed hopes of avoiding the recession. It is noteworthy that Biden\u2019s readiness for the gas tax holiday and softer US data also underpinned the positive mood. US Treasury Secretary Janet Yellen said that the traditional recession measure of two consecutive quarters of negative growth ‘has typically worked’ but recessions aren’t all alike.
Talking about the data, US Existing Home Sales dropped to the lowest levels in two years when talking the annualized number. Further, the Chicago Fed National Activity Index also dropped to 0.01 in May versus a revised down 0.04 prior.
Against this backdrop, the US Dollar Index (DXY) dropped for the second consecutive day, to 104.40 by the press time whereas Wall Street pared the biggest weekly loss in two years. Further, the US 10-year Treasury yields also rose to 3.27% at the latest.
Looking forward, various ECB policymakers are up for speeches and may entertain EUR\/USD traders. However, Powell\u2019s art of defending the tighter monetary policies and the rate hikes will be crucial for the pair traders to watch for clear directions.
Technically; the first daily closing above the 10-DMA, around 1.0500, in nearly three weeks enables EUR\/USD bulls to aim for early June\u2019s swing low near 1.0630.
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Powell\u2019s Testimony is being awaited and eyed amid market talk over the longevity of Fed\u2019s 75 bps rate hike. The EUR\/USD pair holds onto the previous two-day gains around 1.0535-40 during Wednesday\u2019s initial Asian session. The pair\u2019s latest rebound could be linked to the softer US dollar, as well as hawkish comments by the ECB …<\/p>\n","protected":false},"author":13,"featured_media":59567,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[37,36],"tags":[8672,7214,6884,7164,9594,7485],"class_list":["post-67465","post","type-post","status-publish","format-standard","has-post-thumbnail","","category-forex-markets","category-market-updates","tag-barkin","tag-biden","tag-eur-usd","tag-powell","tag-rehn","tag-yellen"],"_links":{"self":[{"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/posts\/67465","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/users\/13"}],"replies":[{"embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/comments?post=67465"}],"version-history":[{"count":2,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/posts\/67465\/revisions"}],"predecessor-version":[{"id":67469,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/posts\/67465\/revisions\/67469"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/media\/59567"}],"wp:attachment":[{"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/media?parent=67465"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/categories?post=67465"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/tags?post=67465"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}