EUR Reaches Two-Month High as Fading Hike Expectations Weaken USD

The EUR/USD pair has reached its highest level in two months due to a weakening US Dollar. A broad-based weakness in the USD has lifted the Euro, erasing all losses recorded earlier this week.

The US Dollar Index (DXY) is trading around 99.50, down 0.47% on the day. The latest batch of US economic data has tempered expectations of a near-term Federal Reserve interest-rate hike.

A sharp shift in market expectations now sees a 70% chance that the Fed will keep interest rates unchanged in September, rather than increasing them as previously expected.