EUR/USD Bounces on Speculation of September Rate Hike Amid Rising Energy Prices

The EUR/USD pair has rebounded from its low in late August, trading above the 1.1600 level after a modest comeback.

Market speculation suggests that the Federal Reserve (Fed) will have to raise benchmark interest rates in September due to persistent Middle East tensions and rising energy prices.

Fed Governor Christopher Waller's statement on Thursday cooled the odds for a rate hike, saying officials can 'wait one meeting' if there are no surprises from upcoming inflation data. However, upbeat employment data released on Friday brought back demand for the USD, causing it to regain its strength.

The US Bureau of Labor Statistics will release August Consumer Price Index (CPI) and Producer Price Index (PPI) data in the coming days, which may define whether the Fed will hike or hold rates when it meets later this month.