- EUR/USD edges up to near 1.1650 as the US Dollar faces selling pressure.
- Fed’s Williams supported the need to look at economic data before getting confident on interest rate cuts in September.
- Opposition parties in France are unlikely to support PM Bayrou’s confidence vote.
The EUR/USD pair edges higher to near 1.1650 during the Asian trading session on Thursday. The major currency pair gains marginally as the US Dollar (USD) faces selling pressure, following dovish remarks on interest rates from New York Federal Reserve (Fed) Bank President John Williams in an interview with CNBC on Wednesday.
During the press time, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, trades 0.12% lower to near 98.00.
On Wednesday, Fed’s Williams argued in favor of interest rate cuts, but didn’t express confidence over the same for the September policy meeting, citing that officials need to see economic data during the time. “Risks are more in balance. We are going to just have to see how the data plays out,” Williams said.
Meanwhile, traders see an 87% chance that the Fed will cut interest rates in the September policy meeting, according to the CME FedWatch tool.
In the Eurozone, growing risks of a snap election in the French economy have capped the upside in the Euro (EUR). Earlier this week, France Prime Minister (PM) François Bayrou called for a confidence vote on September 8 over his €44 billion budget package. In response, opposition parties are not expected to support Bayrou’s confidence vote, a move that could lead to a snap election in the French economy.
On the economic front, investors await preliminary inflation data for August from major economies of the Eurozone, which will be published on Friday.
