Euro Stabilizes Ahead of Crucial Eurozone Growth Figures

The euro held steady on Monday, giving up early gains as investors remained cautious ahead of key Eurozone growth figures and the Federal Reserve's monetary policy decision.

Improved global risk sentiment followed a pause in hostilities between the United States and Iran, leading to a sharp decline in oil prices and a rally across stock and bond markets. West Texas Intermediate (WTI) oil traded near $83.60 per barrel, falling more than 7% as concerns over supply disruptions eased.

Investors now await preliminary second-quarter Gross Domestic Product data from Germany and the broader Eurozone. Eurozone GDP is expected to expand 0.2% QoQ after contracting 0.2% previously, while annual growth is forecast to accelerate to 0.4% from 0.3%. Germany's economy is expected to stagnate quarterly following a 0.3% expansion, although annual GDP growth is projected to rise to 0.6% from 0.4%.

Weaker-than-expected figures could reinforce concerns about the region's economic outlook and put additional pressure on the euro. Germany's preliminary July Consumer Price Index (CPI) will also be closely watched, with monthly inflation expected to rise 0.7% after declining 0.3%, while annual inflation previously stood at 2.3%. Stronger price pressure could support expectations that the European Central Bank will maintain a restrictive stance, supporting the euro.