EUR/USD hovers near yearly low, EU GDP data awaited

EUR/USD continues to trade around yearly low levels of 1.1370 during the early Asian session on Tuesday. Multiple factors and data announcements due for later in the day as well as in the week will determine the pair's outcome. At the time of reporting, the pair is trading at 1.1371, up by 0.1%. The currency pair has not been as low as this since July last year.

The market participants’ sentiments are going to be primarily affected by Federal Reserve speakers, the Eurozone’s upcoming Gross Domestic Product data release and European Central Bank (ECB) President Christine Lagarde’s speech, due for later in the day. 

Notably, Lagarde’s previous statement on the rate hike had pushed the pair lower. She hinted that the conditions for a rate hike are unlikely to be met in 2022, providing support to the dovish sentiments in markets. 

Along with this, investors are also eyeing the US Retail Sales data. Improved figures could benefit the US dollar on expectations for higher growth, while failure to meet the expectations would trigger a dollar-positive risk-off mood.

In addition, as US President Joe Biden formally signed his $1.0 trillion, bi-partisan infrastructure bill that adds another challenge to the pair’s seller. The US 10-year Treasury yields jumped to a fresh three-week high of 1.61%, supporting the US Dollar Index rally at 95.51 to renew the yearly top. 

Meanwhile, as the greenback continued, its strength weakens investor appetite. EUR/USD may pause at its current spot for a while but is just resting up before moving to either side. 

EUR/USD technical levels