Uncertainty over the Federal Reserve’s September policy decision caps euro gains despite supportive Eurozone data and Japanese USD selling.
EUR/USD remains below key resistance at 1.1615/20, despite solid Eurozone economic data and lower oil prices. Analysts note Japanese dollar selling should support the euro, but Fed policy uncertainty dominates near-term moves.
Recent US intervention in EUR/JPY markets, including potential sales of $13bn in euro-denominated reserves, has added short-term pressure. However, the impact is limited given the scale of global FX flows, with US holdings comprising just $1.2bn in deposits and $11.7bn in securities.
This week’s US economic data will determine whether the pair tests resistance or retreats below 1.15. The Fed’s September decision remains the primary driver for EUR/USD trends, overshadowing other factors.