Euro strengthens above 1.1550 as Fed rate hike bets fade

The Euro strengthened above 1.1550 against the US Dollar on Monday as the Federal Reserve rate hike expectations diminished. US economic data released on Friday revealed a decline in Retail Sales, falling by 0.6% month-over-month in July, below the anticipated 0.1% growth. Annual Retail Sales increased by 5.0% in July, revised from the previous 6.7% figure.

This weaker-than-expected data prompted traders to reduce their bets on US Federal Reserve rate hikes, causing the Greenback to weaken against the Euro. The European Central Bank (ECB) President, Christine Lagarde, will provide further insight into the Eurozone's economic outlook during her speech on Wednesday. In the technical analysis, EUR/USD is currently trading above the 100-day simple moving average and the Bollinger Bands' middle line, suggesting a constructive near-term bias.

The pair holds above immediate resistance at 1.1635 and faces support at the 100-day SMA and Bollinger middle band. The Euro's strength is bolstered by the region's improving trade balance, with a surplus reported in June following a brief deficit from March to May. Global tensions, particularly concerning energy supply routes, may further bolster the USD's appeal as a safe-haven currency.