EURUSD Analysis 10-July-2024

The euro fell to $1.082 from a recent high of $1.084 due to a stronger dollar after Federal Reserve Chair Jerome Powell’s testimony. Powell stated that the Fed would not lower the federal funds rate until they were more confident that inflation was moving steadily toward the 2% target.

He also warned that reducing policy restrictions too late or too little could harm economic activity and employment. Investors expect the ECB to cut interest rates once or twice this year in Europe.

This expectation follows initial data showing that the annual inflation rate in the Euro Area dropped to 2.5% in June. However, the core inflation rate stayed at 2.9%, and services inflation was still high at 4.1%. Politically, France had a hung parliament after the second round of elections, which eased concerns about radical policies.

EURUSD Analysis 10-July-2024