Euro Surges as Fed Hike Expectations Fade Amid Weakening US Dollar

The Euro has rallied to its highest level since June 17, reaching around 1.1580 as the US Dollar weakens on fading expectations of a near-term Federal Reserve interest-rate hike.

The recent batch of US economic data has tempered those expectations, with US Retail Sales falling by 0.6% in July and the Consumer Sentiment Index dropping to 51.0 in August from 55.2.

The inflationary impact of the recent energy shock appears to be fading, with price pressures easing for a second consecutive month according to the Consumer Price Index (CPI) and Producer Price Index (PPI) reports.