EUR/USD advances towards 1.0550 despite escalating hawkish Fed bets
|- EUR/USD is marching towards 1.0550 as the DXY is performing lackluster.
- Fed Powell’s testimony has failed to bring a notable impact on the DXY prices.
- For further guidance, investors will focus on the US Durable Goods Orders.
The EUR/USD pair is advancing gradually towards the critical hurdle of 1.0550 as an underperformance is expected from the US dollar index (DXY) amid the unavailability of any potential trigger in Friday’s session. The asset has remained sideways in the Asian session and an upside break from the consolidation is expected after overstepping the intraday high at 1.0538.
It looks like the downbeat US Purchase Managers Index (PMI) is fetching exhaustion in the DXY. The Manufacturing PMI landed at 52.4, much lower than forecasts and the prior print of 56 and 57 respectively. Also, the Services PMI slipped sharply to 51.6 from the consensus of 53.5 and the prior print of 53.4.
The hawkish commentary from Federal Reserve (Fed) chair Jerome Powell in his testimony has failed to bring a notable impact on the DXY prices. It won’t be wrong to state that the market participants have discounted the fact that policy tightening will continue for a prolonged period.
Going forward, the release of the US Durable Goods Orders is expected to bring a decisive move in the asset, which is due on Monday. A preliminary estimate for the economic data is 0.6%, higher than the former release of 0.5%. The preliminary estimate is hinting that the demand prospects in the US economy are much intact.
On the eurozone front, investors are keeping an eye on the Germany IFO Business Climate figures. The economic data indicates the current conditions and business expectations in Germany. A marginal fall is expected in the economic indicator to 92.9 from the prior print of 93.
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