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EUR/USD holds up around 1.0650 ahead of Eurozone Industrial Production

  • EUR/USD rebounds from five-month lows despite hawkish tone surrounding the Fed’s monetary policy outlook.
  • ECB member Gediminas Šimkus indicated that there is a probability of more than 50% for more than three rate cuts to occur in 2024.
  • Traders may seek refuge in the safe-haven US Dollar due to escalated tensions in the Middle East.

EUR/USD rebounds from a five-month low of 1.0622 reached last Friday, hovering around 1.0660 during early European trading hours on Monday. The EUR/USD pair faced downward pressure as the European Central Bank (ECB) and the Federal Reserve (Fed) revealed diverging monetary policy outlooks.

Investors await the release of Eurozone Industrial Production data for March on Monday. Furthermore, the investors’ focus will shift to US Retail Sales figures due to be released later in the day.

The ECB signaled that if underlying inflation continues to decelerate as anticipated, there's a possibility of contemplating a reduction in policy rates in June. Meanwhile, the Federal Reserve (Fed) appears to be reassessing its monetary easing strategies in light of persistent US inflation and strong macroeconomic indicators. Thursday's data revealed that core producer inflation in the United States (US) surged year-over-year in March, surpassing expectations for the increase.

Traders adopt a cautious approach amidst heightened geopolitical tensions, which may prompt them to seek refuge in the safe-haven US Dollar (USD), potentially putting pressure on the EUR/USD pair. There's the possibility of Israel retaliating against Iran's attack. On Saturday, Iran launched explosive drones and missiles targeting military installations in Israel. Israel successfully intercepted most of the incoming projectiles, according to Reuters.

On Monday, Gediminas Šimkus, a member of the European Central Bank (ECB) Governing Council, stated that there is a greater than 50% likelihood of more than three rate cuts occurring this year, as per Reuters. Šimkus also mentioned that geopolitical events, such as an escalation of the Israel-Iran conflict, could potentially postpone the first rate cut to July from June.

EUR/USD

Overview
Today last price1.0658
Today Daily Change0.0012
Today Daily Change %0.11
Today daily open1.0646
 
Trends
Daily SMA201.0813
Daily SMA501.0823
Daily SMA1001.0867
Daily SMA2001.083
 
Levels
Previous Daily High1.0729
Previous Daily Low1.0622
Previous Weekly High1.0885
Previous Weekly Low1.0622
Previous Monthly High1.0981
Previous Monthly Low1.0768
Daily Fibonacci 38.2%1.0663
Daily Fibonacci 61.8%1.0689
Daily Pivot Point S11.0602
Daily Pivot Point S21.0559
Daily Pivot Point S31.0496
Daily Pivot Point R11.0709
Daily Pivot Point R21.0773
Daily Pivot Point R31.0816

Author

Akhtar Faruqui

Akhtar Faruqui is a Forex Analyst based in New Delhi, India. With a keen eye for market trends and a passion for dissecting complex financial dynamics, he is dedicated to delivering accurate and insightful Forex news and analysis.

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