EUR/USD trades unchanged near 1.0840

forex_news_11Event to watch out for today:

15:30 GMT+3. USD – GDP volume change for the quarter

EURUSD:

The Euro-dollar pair traded in negative territory for the third consecutive day around 1.0835 during the Asian session on Thursday. The major pair is adding to the previous day’s losses amid a deteriorating eurozone economic outlook and growing expectations that the European Central Bank (ECB) will cut rates further in September.

Earlier this week, ECB Vice President Luis de Guindos hinted at the possibility of an interest rate cut in September as the central bank will have more information to reassess the monetary policy situation. ECB President Christine Lagarde said last week after holding interest rates that a rate cut in September was “wide open” amid easing inflationary pressures. The expectation of further rate cuts from the ECB is likely to put pressure on the Euro (EUR) in the near term.

Across the ocean, market participants expect the U.S. Federal Reserve (Fed) to begin cutting interest rates in September. According to CME FedWatch Tool data, traders estimate the probability of a 25 basis points (bps) rate cut at 100%, while data from the Chicago Board of Trade (CBOT) showed that market participants estimate a rate easing for 2024 at 53 bps.

Later on Thursday, investors will be keeping a close eye on the ECB’s Lagarde speech as well as the extended second quarter (Q2) US gross domestic product (GDP) data. The US economy is estimated to have grown by 2.0% compared to the previous figure of 1.4%.

Trading recommendation: Watch the level of 1.0840 and take Buy positions on the rebound. If consolidation is below, take Sell positions.

EUR/USD trades unchanged near 1.0840

Origin: FreshForex

 

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