EUR/USD finds support near 1.14, eyes on FOMC statement and Powell speech

• EUR/USD looks to snap 4-day winning streak.
• US Dollar Index clings to modest gains above 95.80.
• ADP reports a higher-than-expected increase in private sector employment.

The EUR/USD pair lost its traction in the second half of the day and fell to a session low of 1.1407 before going into a consolidation phase ahead of the FOMC announcements and Chairman Powell's press conference. As of writing, the pair was down 0.1% on a daily basis at 1.1422.

Following a subdued trading action during the European session, the pair came under a renewed pressure as the US dollar gathered strength on the back of upbeat ADP labour market data, which showed an increase of 213K in private sector employment vs 178K expected. After coming within a touching distance of the 96 mark with the knee-jerk market reaction, the US Dollar Index erased a small part of its gains and was last up 0.08% on the day at 95.88.

Earlier today, the data published by Germany's Destatis showed that the annual CPI in Germany slumped to 1.4% in January (preliminary) to miss the analysts' estimate of 1.6% to weigh on the shared currency. Additionally, the European Commission's monthly report revealed that the Consumer Confidence Index improved slightly to -7.9 from -8.3 while Services Sentiment, Business Climate, and Industrial Confidence indexes all retreated in January. 

Markets don't see the FOMC announcing any changes to its policy rate, which now stands 2.25% - 2.5% range. Previewing the FOMC meeting, "“Keeping in accordance with its most recent communications, which emphasized the central bank’s wait-and-see approach, the Fed will stay on the side-lines this time. It will still be interesting to hear Jerome Powell's comments as he gives his first press conference of the year,” said NBF analysts.

• FOMC Preview: What 8 major banks are expecting from January meeting?

Key technical levels