The Euro extends gains for a third session amid paused US-Iran hostilities and shifting ECB rate hike expectations.
The EUR/USD pair traded near 1.1390 in Monday’s Asian session, marking a third consecutive day of gains. The Euro’s strength persists despite geopolitical risks tied to US-Iran tensions, which could trigger a flight to safety and bolster the USD.
Diplomatic efforts resumed after both nations agreed to pause hostilities in the Gulf and meet in Qatar on Tuesday. The talks follow retaliatory strikes last week, which violated a June 17 ceasefire. Meanwhile, traders assess the ECB’s potential September rate hike amid easing energy prices and cooling inflation fears.
Commerzbank analysts expect one final ECB rate increase, though broader market sentiment remains cautious ahead of the US-Iran negotiations.