EUR/USD Hits Highest Level Since May Amid Dollar Weakness

The EUR/USD currency pair has reached its highest level since May, driven by improving European economic data and dollar weakness following the US Treasury's decision to expand its bond buyback program.

Business activity in the eurozone continued to expand in August, with Germany's industrial sector showing significant improvement. Consumer inflation expectations edged slightly lower, but remain above the ECB's target, keeping expectations of further policy tightening intact.

This week will see a busy schedule of economic data releases from both Europe and the US, including key indicators such as core PCE, Q2 GDP, durable goods orders, and personal income and spending. Weak US data could increase pressure on the dollar and support EUR/USD, while strong inflation data could help the US currency recover.