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Euro steadies near 1.1680 as US dollar faces fiscal buyback pressure
The Treasury pledged to at least double buybacks of longer-dated government debt, potentially expanding beyond $4 billion, as markets weigh the impact on bond yields.
EUR/USD stayed firmer for a fourth straight session, trading around 1.1680 in Asian hours Monday, as the US Dollar came under pressure linked to new US fiscal measures.
According to FXStreet, the US Treasury said it plans to at least double buybacks of longer-dated government debt to help rein in rising bond yields. Treasury Secretary Scott Bessent said the buyback program could expand beyond $4 billion, aiming to signal that higher yields are not aligned with underlying economic fundamentals.
FXStreet also pointed to limits on euro upside from safe-haven demand for the US Dollar amid heightened Middle East tensions. It cited statements from Iran's foreign minister and security chief rejecting upcoming US sanctions and warning of potential retaliation, which reinforced risk-off sentiment.
On the euro side, FXStreet noted ongoing support from eurozone inflation dynamics and expectations for ECB policy. It said eurozone consumer inflation expectations over the next year edged down to 2.9% from 3.0% in June, while price growth still remains above the ECB's 2% target, keeping a case open for additional tightening after June's rate hike.
Latest closeEUR/USD 1.157 ▲0.4%