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EUR/USD holds near 1.15 as September Fed hike odds fall
Markets now assign a 35% probability to a 25-basis-point September hike, down from 55% a week earlier, after softer US inflation data.
EUR/USD was quoted around 1.1537 on Friday as traders digested incoming US economic data and recalibrated expectations for Federal Reserve policy. Softer inflation readings have reduced the odds of a September rate hike.
According to Action Forex, producer prices were flat in July, adding to the earlier CPI picture that suggests inflationary pressures are not accelerating. The report said markets are pricing only a 35% chance of a 25-basis-point Fed hike in September, down from 55% a week earlier.
The outlet also pointed to easing signs from the early inflation impact of the Middle East conflict and high energy prices. It cautioned that uncertainty around a potential US-Iran agreement and the reopening of the Strait of Hormuz could still affect the inflation outlook.
On the technical side, Action Forex described EUR/USD as range-bound on the H4 chart between 1.1511 and 1.1545, noting that an upside break could target 1.1570, while a downside move could open a path toward 1.1492 and, potentially, 1.1400.
Latest closeEUR/USD 1.153 ▼0.1%