EUR/USD turns sideways around 1.0950 as investors await US Employment for fresh impetus

• EUR/USD is oscillating around 1.0950 ahead of US Employment and ISM Services PMI data.
• A significant decline in US Job Opening indicates that the US labor market is cooling now.
• The ECB would continue hiking rates as a recent jump in the oil price could spark Eurozone inflation.

The EUR/USD pair is displaying a sideways action after an upside move above 1.0970 in the early Asian session. The shared currency pair is expected to continue its lackluster move as investors are awaiting the release of the United States Automatic Data Processing (ADP) Employment and ISM Services PMI data.

S&P500 ended Tuesday’s gains with decent losses as investors turned cautious ahead of US economic reports, portraying a drop in the risk appetite of the market participants. The US Dollar Index (DXY) has refreshed its monthly low near 101.46 as investors are anticipating the maintenance of status-quo by the Federal Reserve (Fed) for its May monetary policy meeting.

As per the CME Fedwatch tool, chances for an unchanged interest rate decision stand near 60%. The Fed is required to shift its focus towards contracting manufacturing activities to safeguard the United States economy from falling into recession. The release of the US economic data on Wednesday would provide more clarity.

According to the consensus, the US economy has added fresh 200K jobs in March than the former additions of 242K. Hopes for one more rate hike from the Fed could be propelled if the US labor market continues to remain tight. However, the release of weak Job Openings data on Tuesday indicates that the labor market is cooling now. Data released on Tuesday indicates lower talent acquisition requests at 9.9 million, compared to 10.5 million in January and 10.4 million as expected by the market participants.

In addition to US Employment data, US ISM Services PMI will also keep investors busy. The US ISM Services PMI (Mar) is expected to contract to 54.5 from the former release of 55.1. Also, New Orders Index that reflects forward-demand would drop to 57.6 from the prior release of 62.6.

On the Eurozone front, European Central Bank (ECB) policymakers would get delighted as consumer inflation expectations for the next 12 months fall to 4.6% in February vs. 4.9% in January. However, it seems that the data has yet not incorporate the recent rise in the oil price, which could have spoiled the mood. Therefore, ECB President Christine Lagarde would continue hiking rates ahead.