- EUR/USD is trading in a relatively tight range above 1.1800 on Monday.
- ECB is reportedly reluctant to adopt average inflation targeting.
- US Dollar Index looks to end flat a little above 93.00.
After gaining more than 100 pips last week, the EUR/USD pair started the new week in a quiet manner and struggled to make a decisive move in either direction as trading conditions remained thin due to the Columbus Day holiday in the US. As of writing, the pair was down 0.12% on the day at 1.1808.
There were no significant macroeconomic data releases from the euro area on Monday and Christine Lagarde, President of the European Central Bank (ECB), refrained from delivering any comments on the policy outlook while speaking at an IMF event.
Meanwhile, citing sources with knowledge of the matter, Reuters reported on Monday that the ECB policymakers are reluctant to adopt average inflation target in its new strategy, which is expected to be revealed in December.
Rising US stocks keep DXY’s upside capped
On the other hand, the USD gathered strength against its rivals during the first half of the day but failed to preserve its momentum as surging equity indexes in the US made it difficult for the greenback to continue to find demand. At the moment, the S&P 500 and the Nasdaq Composite indexes are up 2% and 4%, respectively, while the US Dollar Index is looking to close unchanged a little above 93.06.
On Tuesday, the Consumer Price Index (CPI) from the US and Germany will be looked upon for fresh impetus. Additionally, investors will keep a close eye on the ZEW Survey – Economic Sentiment data for the euro area and Germany.
Other data from the US will include the NFIB Business Optimism Index and the IBD/TIPP Economic Optimism Index.
Technical levels to watch for
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