EUR/USD Teeters on Monthly Low Ahead of Key Federal Reserve Meeting
The EUR/USD pair is hovering near its monthly low as it approaches the final week of July, with some traders speculating that a key catalyst will be the Federal Reserve's meeting this week.
Last Friday's modest decline in energy prices briefly reduced expectations of an immediate Fed rate hike, but markets continue to price in at least one increase before the end of the year. The renewed escalation in the US-Iran conflict and supply disruptions in the Persian Gulf and Red Sea have pushed oil prices higher, reinforcing inflation risks.
The US economic data has been strong, with S&P PMIs showing the fastest pace of private business activity growth this year and initial jobless claims falling at their fastest pace in nearly six decades. This has provided support for the dollar.