EUR/USD Tops 1.1600 Again As Greenback Pulls back

The European currency is finally having one above the greenback after falling behind for most of the week.

EUR/USD Finally Rallying

The EUR/USD pair is finally rallying after the Euro recorded some losses since the start of the week. The pair topped the 1.1600 level earlier today as the greenback extended its hotter US inflation-led losses.

The upbeat market mood for the shred currency led to the Euro rallying higher earlier today. However, the greenback continues to underperform against the other major currencies. The FOMC minutes released yesterday indicate a November/ December taper. The United States government is still optimistic about reaching a deal with the European Union regarding steel tariffs before the end of the month.

Investors are now keenly watching the US PPI and the statements from the United States Federal Reserve. These key events would determine how the greenback and the EUR/USD pair would perform over the coming trading sessions.

Despite the EUR/USD pair recording gains earlier today, the rally is fueled mainly by the huge selling pressure surrounding the US Dollar instead of a renewed EURO strength. The European Central Bank continues to falter in terms of its policies, and investors are not too thrilled with the Euro at the moment.

EUR/USD Could Head Towards 1.1670

The EUR/USD pair could record further gains over the coming hours if the greenback gets weaker. The benchmark 10-year US T-bond yield lost nearly 3%, leading to the greenback struggling to find demand.

The United States Department of Labor’s Weekly Initial Jobless Claims data and September Producer Price Index (PPI) numbers will be released later today. While they may not trigger a significant reaction in the market, the figures would determine if the greenback is able to stage a comeback against the Euro later today. The EUR/USD pair could surge higher towards the 1.1670 later today if the market condition persists.

If the 10-year US T-bond yield continues to hold above the critical 1.5% mark, the US Dollar could regain its strength, and the EUR/USD pair could drop below the 1.1600 level in the coming hours. Market participants would be watching the 10-year US T-bond yield to see if it stays or drops below the 1.5% region.