Euro Crashes to 7-Week Lows As the US Dollar Surges Higher

The euro today fell against the US dollar for the third consecutive session as investors trimmed their expectations of a massive rate cut by the Fed boosting the greenback. The EUR/USD currency pair was also affected by market expectations of the announcement of further monetary easing policies by the ECB later this week.
The EUR/USD currency pair today fell from an opening high of 1.1208 to a low of 1.1147 in the American session and was trading near these lows at the time of writing.
The currency pair traded with a strong bearish bias from the start of today’s session as investors priced-in the introduction of more monetary easing measures by the European Central Bank at its meeting on Thursday. The release of the lending survey by the ECB early in the European session had a muted impact on the pair. The release of the positive eurozone consumer confidence survey by the European Commission in the afternoon triggered a slight recovery by the currency pair; the print came in at -6.6 versus the expected -7.1.
The US Dollar Index today rallied to a new 5-week high of 97.71 reflecting the greenback’s strength against most major currencies including the euro. The release of the weak Richmond Fed manufacturing index, which fell to a low of -12 in July versus the consensus estimate of 5, could not derail the greenback’s gains.
The currency pair’s future performance is likely to be affected by tomorrow’s multiple PMI releases from both the European and American dockets.
The EUR/USD currency pair was trading at 1.1155 as at 16:16 GMT having fallen from a high of 1.1208. The EUR/JPY currency pair was trading at 120.57 having dropped from a high of 121.08.

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