EUR/USD holds positive ground around 1.0770, US CPI data eyed
11.12.2023, 00:43

EUR/USD holds positive ground around 1.0770, US CPI data eyed

  • EUR/USD holds ground near 1.0770, up 0.06% on the day.
  • The US labour market  may convince the Federal Reserve (Fed) to delay rate cuts in 2024.
  • The market expected the European Central Bank (ECB) to hold rates until the inflation will return to target in a timely manner.
  • Traders will monitor US inflation data ahead of the FOMC, ECB monetary policy meeting.
The EUR/USD pair kicks off the new week on a positive note during the early Asian session on Monday. The rebound of the pair is backed by the consolidation of the US Dollar (USD) following stronger-than-expected US employment data. At press time, the major pair is trading at 1.0770, gaining 0.06% on the day.

The US labour market improved in November, with better-than-expected growth, lower unemployment, and higher wages, according to the US Bureau of Labor Statistics (BLS) on Friday. Treasury bond yields rose considerably immediately as investors speculated that the report may convince the Federal Reserve (Fed) to delay rate cuts in 2024.

The US Nonfarm Payrolls (NFP) added 199K employees, above the market expectation of 180K. Meanwhile, the Unemployment Rate declined from 3.9% to 3.7%, and the average hourly earnings remains unchanged at 4.0% YoY.

Across the pond, the German inflation data, as measured by the Harmonized Index of Consumer Prices (HICP) came in at 2.3%, in line with the market consensus. The markets anticipate that the European Central Bank (ECB) will hold interest rates until inflation will return to target in a timely manner and will start to cut interest rates in March 2024.

The Federal Open Market Committee (FOMC) and the ECB monetary policy meeting will be in the spotlight this week. Ahead of the key events, market participants will take cues from the US Consumer Price Index (CPI), due on Tuesday. The annual inflation data for November is estimated to ease from 3.2% to 3.1%, while the core inflation is expected to remain unchanged at 4.0% YoY.
 

 

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