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EUR/USD continues to move further above the 1.0250 mark during the opening hours of the European trading period. A lower hawkish tone from the Federal Reserve is burdening the United States Dollar. At the same time, European Central Bank officials see the need for a reduced interest rate come next December.
Meanwhile, the United States Dollar index is gaining traction under its important support of 107.60. This is because investors are increasingly becoming worried before the release of the United States Durable Goods Order data. Also, the S&P 500 futures are showing signs of volatility reduction during a quiet market mood. Additionally, the returns on the United States government bond are getting pressurized once more.
Additional EUR/USD Price Drivers
The ten years United States yield has fallen under the 3.8% level, following a recovery move by the Fed. This is because their policymakers are in favor of reducing the speed of interest rate increases. For example, Federal Reserve officials from Cleveland and San Francisco both opined that the interest rate should be slowed down.
On the EUR side, investors are moving their attention towards talks about interest rate increases by the ECB in its next month’s monetary policy gathering. The European Central Bank Economists Philip Lane disclosed that the central bank will ruminate on slowing down the speed of its rate hikes during its next month’s gathering. He also included that the huge move, increasing interest rates by 75 bps has already been done and at this point, the ECB will consider the inflation outlook for subsequent moves.
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