EUR/USD Edges Up Ahead of US Data Amid Strong ECB Hike Expectations

The EUR/USD pair is trading marginally higher at around 1.1536 against the US dollar during the European session on Wednesday. The Euro edges up as the US dollar trades lower ahead of the US ADP Employment Change data for July, which will be published at 12:15 GMT.

According to estimates, US private employers hired 70K fresh workers, lower than 98K in June. This data will have a significant impact on the Federal Reserve's interest rate expectations as officials have stopped providing so-called 'forward guidance'. Meanwhile, the Euro is expected to trade strongly amid firm expectations that the European Central Bank (ECB) will hike interest rates.

Market pricing remains aligned with TD Securities' policy outlook, which sees a 25bp ECB rate hike in September as its base case. ECB Governing Council member Martin Kocher has stated that he remains data-dependent for the monetary policy outlook and is committed to bringing inflation down to the 2% target on a sustainable basis.