The Euro (EUR) posts minor gains against the US Dollar (USD) on Wednesday, trading near 1.1640 at the time of writing, right below weekly highs at the 1.1650 area.
Hawkish comments from European Central Bank (ECB) officials have given a fresh boost to the Euro, while hopes of a US-Iran peace deal keep USD rallies limited
On Tuesday, ECB Board member Isabel Schnabel warned that “looking through the inflation spike is no longer an option” and that a June rate will be needed. Earlier in the day, ECB Chief Economist Philip Lane said in an interview with Nikkei that he does not think that the market needs extra guidance from the bank and seemed comfortable with ongoing speculation on upcoming monetary tightening. Beyond that, investors remain hopeful that the US-Iran war might end through negotiation, despite Tehran’s outrage over a US attack earlier this week.
These hopes are keeping Oil prices significantly below last week’s highs, easing pressure on the Eurozone economies and providing additional support for the Euro. In the US, the Dallas Federal Reserve (Fed) President Lorie Logan kept all options open on Monday, affirming that the next Fed move might either be a hike or a rate cut. Investors are likely to await the release of the US Personal Consumption Expenditure (PCE) Price Index figures, due on Thursday to better assess the central bank’s rate path.