Forex
EUR/USD Trapped in Range Ahead of Central Bank Meetings
The EUR/USD currency pair has been trading in a narrow band between 1.1550 and 1.1600 as investors await fresh policy signals from the European Central Bank and the Federal Reserve.
This range-bound trading reflects a balance of opposing forces, with the euro finding support from stronger-than-expected eurozone economic data and rising inflation expectations.
On the other hand, the dollar has been underpinned by expectations that the Federal Reserve will begin tapering its asset purchases later this year, which tends to boost the greenback's appeal.
The key driver for the pair remains the policy divergence between the ECB and the Fed, with the Fed signaling it could begin reducing its bond-buying program as soon as November.