Traders remain cautious amid mixed signals on US-Iran negotiations and stronger-than-expected US manufacturing data supporting the USD.
EUR/USD traded in a tight range around 1.1515 on Monday, paring earlier gains as uncertainty over US-Iran talks and Federal Reserve policy kept investors on edge. The pair reached an intraday high of 1.1558, its strongest level since June 17, before retreating slightly.
Conflicting reports on US-Iran negotiations added to market caution, with US President Donald Trump announcing a called-off strike while Iran denied ongoing talks. Meanwhile, the US ISM Manufacturing PMI rose to 55.6 in July, exceeding expectations and marking its highest reading since May 2022. The Eurozone’s PMI improved to 51.9 but fell short of forecasts.
The US Dollar Index (DXY) rebounded to 99.84 after hitting a low of 99.42, supported by the stronger US data. Traders await further clarity on geopolitical developments and monetary policy signals.