EXECUTIVE SUMMARY
EUR/USD is trading close to 1.10, up +0.51% from 1.086 a week earlier.
Concerns about the US economy have hit the US dollar hard, with market participants increasing their expectations for a Fed rate cut as early as next week, following a decision to keep rates at 5.5% last Wednesday. Similarly, escalating tensions in the Middle East have fuelled risk aversion, further penalising the dollar.
In the eurozone, the final estimate of the EU composite PMI for July has been revised upwards to 50.2, slightly better than the previous reading of 50.1. In addition, the producer price index (PPI) has fallen by 3.2% year-onyear by the end of June 2024.
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