Euro weakens below 1.1400 as Fed rate hike expectations reinforce US Dollar strength
The EUR/USD pair loses ground to near 1.1380 during the early Asian trading hours on Thursday. The major pair extends its downside as hawkish signals from the US Federal Reserve (Fed) boost the US Dollar (USD) against the Euro (EUR).
EUR/USD pair tumbles to near 1.1380 early Thursday trading, downgrades due to Fed's hawkish signals strengthening US Dollar. Traders monitor US weekly jobless claims and Fed's speech for clues. Preliminary S&P Global PMI shows manufacturing rose to 52.0 in September, above expectations, while services PMI dipped to 51.7, below market consensus.
ECB policymaker Gabriel Makhlouf hints at potential further interest rate hikes if energy prices impact other sectors. Fed Governor Michael Barr signals further policy adjustments needed to curb inflation. Fed President Tom Barkin and Susan Collins back recent rate hikes citing persistent inflation. Hawkish remarks boost Greenback, hinder EUR/USD in near term.
Markets price 69.7% chance of a rate hike in October, up from 48.7% a week ago. ECB's potential rate hike adds to Dollar's bullish outlook. Technical analysis shows EUR/USD weakening below key moving averages, indicating bearish near-term trend.
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