Euro treads water against US Dollar as traders await US CPI
EUR/USD trades around 1.1535 on Tuesday at the time of writing, posting a modest 0.06% decline on the day.
The Euro (EUR) faced pressure against the US Dollar (USD) on Tuesday as traders awaited the US Consumer Price Index (CPI) data. EUR/USD traded around 1.1535, down 0.06% for the day. The pair remained away from its seven-week high of 1.1581 due to tensions between the US and Iran over the Strait of Hormuz. Reciprocal demands for compensation over war damages and restricted shipping traffic added to uncertainty.
Iran ruled out new negotiations with US President Donald Trump until his term ends in January 2029. US Dollar (USD) gained support from comments by Cleveland Fed President Beth Hammack, who stated that current monetary policy "is not hurting the economy" and more rate hikes may be needed to bring inflation back to target. The US CPI data for July, released on Wednesday, could provide clues about the Fed's interest rate outlook.
Analysts noted subdued trading conditions and highlighted positioning risks for European investors on the dollar hedge ratios. EUR/USD is expected to remain within a narrow range of 1.1515-1.1560.
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