- EUR/USD is juggling in a 1.0424-1.0445, following the footprints of the DXY.
- A higher eurozone HICP has bolstered the odds of a rate hike by the ECB.
- The FOMC minutes will display the detailed ideology behind announcing the 75 (bps) rate hike by the Fed.
The EUR/USD pair is oscillating in a narrow range of 1.0424-1.0445 in the early European session. The asset has turned sideways as the US dollar index (DXY) is trading lackluster. Earlier, the asset witnessed a responsive buying action after hitting a low of 1.0365 on Friday. A firmer rebound in the major was backed by weakness in the DXY and a higher Eurozone Harmonized Index of Consumer Prices (HICP) print.
The eurozone agency reported the HICP at 8.6%, higher than estimates and the prior print of 8.4% and 8.1% respectively and similar to the inflation rate in the US economy. The inflation rate is scaling continuously higher in the eurozone and the European Central Bank (ECB) has yet not elevate its interest rates. However, this time a jumbo rate hike announcement cannot be ruled out as safeguarding households from the real income shock is invincible. It is worth noting that the ECB has yet not followed the footprints of Western leaders and may announce its first rate hike in 11 years.
On the dollar front, the DXY is awaiting the release of the Federal Open Market Committee (FOMC) minutes, which are due on Tuesday. The FOMC minutes will display the detailed ideology behind announcing the 75 basis point (bps) rate hike by the Federal Reserve (Fed). Apart from that, the US Nonfarm Payrolls (NFP) figures will remain in focus. A preliminary estimate for job additions in June is 250k, extremely lower than the former additions of 390k in May.