EUR/USD remains sideways above 1.0800 ahead of US Biden-McCarthy discussions
- EUR/USD is showing a sideways performance above 1.0800 as the focus is on US debt-ceiling negotiations.
- S&P500 settled marginally positive on Monday after a choppy session, portraying a quiet market mood.
- Republican McCarthy said that talks over raising the U.S. borrowing cap were "on the right path” ahead of discussions with US Biden.
The EUR/USD pair is displaying a topsy-turvy action above the round-level support of 1.0800 in the early Tokyo session. The major currency pair didn’t show a decisive action despite mixed responses from Federal Reserve (Fed) policymakers over the interest rate guidance. Investors are awaiting face-to-face negotiations between US President Joe Biden and House o Representatives Speaker Kevin McCarthy for a major action.
S&P500 settled marginally positive on Monday after a choppy session, portraying a quiet market mood. US equities remained sideways waiting for more development over US debt-ceiling issues.
The US Dollar Index (DXY) has rebounded after a corrective move to near 103.17. Meanwhile, Speaker Kevin McCarthy is optimistic about the approval of the US debt-ceiling. A few hours ahead of a face-to-face meeting with US President Joe Biden, Republican McCarthy said on Monday afternoon that talks over raising the U.S. federal government's $31.4 trillion debt ceiling were "on the right path", as reported by Reuters.
A mixed majority in the House of Representatives and Senate has given importance to a bipartisan deal, which has made US Treasury Secretary Janet Yellen nervous that the economy could announce a default in making obligated payments.
Minneapolis Fed Bank President Neel Kashkari cautioned that while it may appear like the worst period of the banking turmoil is over, history showed more trouble can't be ruled out, as reported by Reuters. On the weekend, Fed policymaker cited that he would support the Fed for holding interest rates in June.
On the Eurozone front, European Central Bank (ECB) policymaker Francois Villeroy de Galhau said "I expect today that we will be at the terminal rate not later than by summer," He further added, "Deceleration in rate increases from 50 bp to 25 bp was wise and cautious." This has allowed the ECB to push its interest rate cycle longer and has safeguarded the economy from any interest rate shocks.
Author
Sagar Dua
FXStreet
Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.
