Euro Struggles Against US Dollar as Fed Rate Hike Expectations Grow

The Euro struggled to recover on Tuesday as investors maintained their demand for the US dollar in anticipation of another potential interest rate hike by the Federal Reserve.

As of approximately 9:50 GMT time, the euro traded near $1.1370, a marginal 0.05% increase after struggling with recent losses.

The U.S. dollar index held steady at around 101.50, its highest level since July 1, as markets priced in a 40% probability of a 25 basis point rate hike by the Federal Reserve on Wednesday.

Fed expectations generally support the dollar, increasing returns on dollar-denominated assets and making it harder for the euro to stage a sustained recovery.