Dollar's Strength Squeezes EUR/USD as Germany's Retail Sales Fall

The EUR/USD pair is under pressure due to a stronger U.S. dollar and weaker German retail sales, which fell by 3.4% in July, their sharpest decline in over four years.

This has raised concerns about the strength of the German consumer, just as the European Central Bank (ECB) prepares to release inflation data, with expectations of a 3.3% reading in August.

The dollar's strength is also being driven by higher Treasury yields and the more hawkish tone from Fed Chair Kevin Warsh at Jackson Hole, which has increased the probability of a September rate hike to around 65%.