EUR/USD trades modestly higher on Wednesday as weaker-than-expected US labour market data and easing energy-driven inflation risks temper Federal Reserve (Fed) rate-hike expectations and weigh on the US Dollar (USD).
At the time of writing, EUR/USD trades around 1.1554, up nearly 0.20% on the day
The US Dollar Index (DXY), which tracks the Greenback’s value against a basket of six major currencies, trades around 99.70. ADP Employment Change rose by 44K in July, missing expectations of 70K and slowing from 98K in June. The report follows Tuesday’s weaker-than-expected JOLTS Job Openings data.
Meanwhile, the ISM Services Purchasing Managers Index (PMI) edged up to 54.1 in July from 54 in June but fell short of the 54.5 market forecast. According to the CME FedWatch Tool, traders now price in around a 56% chance of a September rate hike, down from 67% a day earlier. Attention now turns to Friday’s Nonfarm Payrolls (NFP) report for fresh clues about the US labour market.