- EUR/USD struggles make a decisive move in either direction on Tuesday.
- US Dollar Index retreats to 90.50 after renewing monthly highs.
- Retail Sales in US declined by 1.3% in May.
After staying stuck in a very tight range during the Asian trading hours, the EUR/USD pair reached a daily high of 1.2148 in the European session. Although the pair dropped toward 1.2100 with the USD gathering strength in the second half of the day, it managed to stage a rebound and was last seen posting small daily gains at 1.2125.
USD holds steady ahead of FOMC policy announcements
Earlier in the day, the data published by Eurostat showed that the euro area’s trade surplus widened to €9.4 billion (seasonally adjusted) in April. Nevertheless, this reading was largely ignored by market participants.
On the other hand, the US Census Bureau reported on Tuesday that Retail Sales in May declined by 1.3%, missing the market expectation for a decrease of 0.8%. Furthermore, the monthly publication released by the Fed revealed that Industrial Production grew by 0.8%, compared to analysts’ estimate of 0.6%.
With the initial market reaction to the mixed US data, the US Dollar Index (DXY) advanced to a fresh monthly high of 90.67 but struggled to preserve its bullish momentum. At the moment, the DXY is up 0.08% on the day at 90.57. The modest losses witnessed in Wall Street’s main indexes seem to be helping the index stay in the positive territory.
There won’t any other macroeconomic data releases from the US in the remainder of the day and the pair is likely to extend its sideways grind ahead of the FOMC’s monetary policy announcements on Wednesday.
Technical levels to watch for
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