EUR/USD tumbles to lows near 1.1770 ahead of CPI

The single currency is giving away part of yesterday’s gains vs. the greenback, now dragging EUR/USD to the 1.1775/70 band, or daily lows.

EUR/USD focus on CPI

Despite Thursday’s rebound, the pair remains under pressure in the lower en of the recent range and trading close to fresh multi-week lows in the vicinity of 1.1720, all amidst a broad-based recovery of the greenback and yields in the US money market.

In fact, yields of the US 10-year benchmark managed to clinch the 2.36% area yesterday, although the upside momentum lost some vigour and is now gyrating around the 2.32% region.

On the USD-side, the US Dollar Index abandoned the area of recent tops near 93.70 and briefly tested sub-93.00 levels on Thursday, where it seems to have found some dip-buyers for the time being. It is worth recalling that the recent up move in the buck has been sustained by rising optimism over Trump’s tax reform plan, although the enthusiasm ebbed following the announcement on Wednesday.

Today’s calendar in the euro area will see advanced inflation figures for the month of September and German labour market figures. Across the pond, inflation figures tracked by the PCE for the month of August are due, followed by personal income/spending, the Chicago Fed PMI and the Reuters/Michigan index.

EUR/USD levels to watch

At the moment, the pair is losing 0.09% at 1.1776 and a breakdown of 1.1717 (low Sep.27) would target 1.1662 (low Aug.17) en route to 1.1564 (100-day sma). On the upside, the initial hurdle emerges at 1.1817 (55-day sma) followed by 1.1868 (10-day sma) and finally 1.1904 (21-day sma).