Investors await Wednesday’s US CPI data after July’s weak NFP reduced September Fed rate hike odds to 44%.
EUR/USD held near 1.1553 on Monday, unchanged as the US Dollar Index (DXY) stabilized above 99.50. The pair has traded in a tight range for over a week amid mixed signals on Federal Reserve policy and Middle East tensions.
Weaker-than-expected US Nonfarm Payrolls data last week cut expectations for a September rate hike, but rising oil prices fueled concerns over persistent inflation. The CME FedWatch Tool shows markets pricing a 44% chance of a hike next month.
Focus shifts to Wednesday’s US Consumer Price Index report, where a softer print could further dent rate hike bets and pressure the USD. Analysts note August typically sees limited ECB communication, reducing near-term euro volatility.