FX.co ★ Euro Falls to One-Month Low

The euro declined to $1.16, marking its lowest point in approximately a month, primarily due to a slight recovery in the US dollar. This resurgence of the dollar was bolstered by diminishing expectations of Federal Reserve interest rate cuts this year, following recent inflation reports and President Trump's indication that he would not dismiss Fed Chair Jerome Powell. Simultaneously, markets are closely monitoring trade negotiations, with a prevailing optimism that a US-European Union trade deal could be achieved before August 1st. Although President Trump announced a 30% tariff on EU imports commencing next month, he later showed a willingness to engage in negotiations. In response, the EU reiterated its dedication to reaching a trade accord. Regarding monetary policy, investors generally anticipate that the European Central Bank (ECB) will maintain interest rates in its upcoming meeting. Nonetheless, market projections still include the possibility of an additional 25 basis point rate cut later this year. Inflation in the Eurozone was confirmed at an annual rate of 2% in June, with core inflation stable at 2.3%.