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Euro to US Dollar Exchange Rate Slide Slows ahead of Federal Reserve Meeting Minutes

Euro to US Dollar Exchange Rate Edges Away from Half-Month-Worst

After notable losses last week, the Euro to US Dollar (EUR/USD) exchange rate continued to tumble when markets opened on Monday. Movement in the pair cooled and rebounded from lows today, as investors were hesitant to sell it further ahead of upcoming Federal Reserve news.

Following last week’s sharp slump from 1.1369 to 1.1258, EUR/USD’s losses have been more modest this week so far.

Yesterday saw EUR/USD briefly touch on its lowest level since mid-June, 1.1196, but this morning the pair trended closer to the level of 1.1215 again.

The Euro (EUR) has been supported by fresh data today, but the Euro to US Dollar exchange rate may be in for even further losses if the Federal Reserve takes a less dovish than expected tone in its latest meeting minutes report.

Euro (EUR) Exchange Rates Edge Away from Worst Levels on French Production Stats

Demand for the Euro has been weak over the past week, as fresh signs of weakness in the Eurozone economic outlook and expectations for further dovishness from the European Central Bank (ECB) led to higher ECB interest rate cuts.

Some investors even speculate that the ECB could be pressured to cutting interest rates as soon as this month if Eurozone data continues to concern economists.

Due to this and a rebounding US Dollar (USD), the shared currency has been trending more weakly.

Still, as the Euro hit its worst levels in over half a month yesterday, investors have been hesitant to sell the shared currency much lower.

The Euro also saw some slightly stronger support this morning, due to the publication of France’s much stronger than expected May industrial production report.

French industrial production was forecast to slow to 0.2, but instead saw a surprising surge to 2.1%. It marked the best monthly output figure since 2016 and was seen as a point of surprising optimism for the Eurozone amid continued weakness in Germany’s economy.

US Dollar (USD) Exchange Rates Advance Slows Ahead of Anticipated Fed Minutes

Numerous factors bolstered demand for the US Dollar last week, including fresh US-China trade hopes and some stronger than expected US Non-Farm Payroll stats.

As a result of these factors, bets that the Federal Reserve would show an aggressively dovish tone on monetary policy lightened, and the US Dollar regained some of its recent losses.

Still, while US Dollar demand has generally pushed the currency higher this week so far, its advances slowed today as investors anticipated this evening’s major Federal Reserve news.

There is still uncertainty over whether markets have been overdoing Fed interest rate cut bets, so investors eagerly await more detail on the bank’s most recent policy decision.

Demand for the US currency has also been weighed by yesterday’s US business optimism and job openings stats, which both came in a little weaker than expected.

Euro to US Dollar (EUR/USD) Exchange Rate Investors Await Fed Minutes and German Inflation

While the Euro to US Dollar (EUR/USD) exchange rate’s movement has been a little limited this week so far, there is plenty for Euro and US Dollar investors to react to in the coming sessions, with major news and data still on the way.

Today may be the most important session of the week for US Dollar investors, as the Federal Reserve will publish its June meeting minutes.

It will give markets a better idea of how the bank felt about monetary policy when it took its dovish shift last month, and will influence Fed interest rate cut bets ahead of July’s own policy decision.

Upcoming speeches from Fed officials, including a testimony from Chairman Jerome Powell, could also influence Fed bets. If Fed interest rate cut bets lighten further, EUR/USD is likely to see fresh losses.

US Dollar investors are also highly anticipating US inflation data due for publication tomorrow, and German and French inflation data due tomorrow could be the biggest news of the week for Euro traders.

These inflation stats have the potential to influence Central Bank speculation as well, and could cause some late-week Euro to US Dollar (EUR/USD) exchange rate movement.