EUR/USD Hits 7-Week High as Dollar Weakness Continues

The EUR/USD pair has reached its highest level since June 17 at $1.1557, up 2.07% from the June low of $1.1323.

This recovery is largely driven by dollar weakness, with the dollar index holding near a seven-week low at 99.65 after foreign selling of long-dated US debt.

The eurozone inflation rate rose to 2.9% in July, with energy prices reaching 10.0%, keeping an ECB hike alive and supporting the euro.

However, momentum readings are now in overbought territory, which could lead to a reversal if there is adverse data on Friday's payroll print.