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EUR/USD slips as stronger US PMI lifts the dollar
The euro traded near 1.1377 after moving back from an intraday peak of 1.1401, with the US Dollar Index around 101.42 and markets pricing an 80% chance of a September rate hike.
EUR/USD pared earlier gains on Friday as a stronger set of US business activity readings supported the dollar, FXStreet reported. The pair was last around 1.1377, hovering near a three-week low after retreating from an intraday high of 1.1401.
The US Dollar Index, which tracks the greenback against a basket of six major currencies, was around 101.42 after recovering from an intraday low near 101.25. FXStreet cited a preliminary S&P Global Composite PMI rising to an eight-month high of 53.6 in July from 51.9 in June, with Services PMI also climbing to 53.6 from 51.2.
Oil prices added to the backdrop for the greenback, with WTI up nearly 8% on the week as the Middle East war threatens shipping through the Strait of Hormuz and Bab el-Mandeb. FXStreet also pointed to inflation risks from that move and from new US tariffs, with CME FedWatch pricing an 80% chance of a September rate hike, even as rates are expected to stay unchanged at the July 28-29 meeting.
On the euro side, stronger Eurozone PMI data initially supported the currency, with the preliminary HCOB Composite PMI rising to 51.9 in July from 50.0 and beating the 50.2 forecast. FXStreet said Services PMI increased to 51.6 from 49.4, while Manufacturing PMI rose to 52.0 from 51.4.
Latest closeWTI crude $92.23 ▲6.2%|EUR/USD 1.138 ▼0.2%|Dollar index 101.44 ▲0.3%