The U.S. dollar dipped after data showed that U.S. growth slowed more than expected in the third quarter. The greenback’s weakness benefited other counterparts such as the euro which rose toward 1.17.
European Central Bank President Christine Lagarde pushed back on interest rate increases, saying markets are ahead of themselves. Lagarde acknowledged that inflation will last longer than originally anticipated. ECB policy makers expect inflation to exceed the 2 percent target next year but hold different views on whether inflation will persist in 2023.
The market, however, still sees faster rate increases with rate-hike bets being trimmed only slightly after the ECB’s press conference.
The euro rose to a high of 1.1692 and if euro bulls are able to overcome the 1.17-hurdle we will shift our focus to higher highs at 1.1730 and 1.1750. For bearish momentum to accelerate we must see a renewed drop below 1.1620 but more importantly below 1.1590.
Today we have the PCE Price Index scheduled for release at 12:30 UTC which could affect the dollar’s performance.
Have a beautiful weekend.
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