Euro Retreats Below 1.1650 as US Inflation Supports Dollar Ahead of Jackson Hole

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 Euro Retreats Below 1.1650 as US Inflation Supports Dollar Ahead of Jackson Hole


The Euro (EUR) is coming under pressure against the US Dollar (USD), extending its decline as traders reassess Federal Reserve interest-rate expectations following the latest US inflation data. EUR/USD has slipped toward the 1.1650 area as the Dollar remains supported ahead of the Jackson Hole Economic Symposium.


US Personal Consumption Expenditures (PCE) inflation rose 3.7% year over year in July, while core PCE increased 3.3%. The figures have kept inflation concerns elevated and encouraged markets to price a greater possibility of additional Federal Reserve tightening later this year.


The Dollar's recovery has been reflected across major currency pairs, with the US Dollar Index holding above 99.00 on Thursday. Investors are now waiting for Federal Reserve Chair Kevin Warsh's speech at Jackson Hole on Friday for further clues about the future path of US monetary policy.


EUR/USD Technical Outlook


The 1.1650 area is an important near-term level for EUR/USD. Holding around this zone could allow the pair to stabilize, while a sustained break below it could expose the Euro to further downside.


On the upside, a recovery above 1.1700 would improve the short-term technical picture and could bring recent highs back into focus. However, continued Dollar strength and higher US rate expectations could make it difficult for EUR/USD to regain momentum.


Market Outlook


The Jackson Hole Symposium is now the key event for currency markets. A hawkish message from the Federal Reserve could provide additional support for the US Dollar and keep EUR/USD under pressure. Conversely, a dovish signal could weaken the Dollar and allow the Euro to recover.


For now, traders are watching 1.1650 support and 1.1700 resistance while awaiting clearer guidance on US monetary policy.


Disclaimer: This article is provided for informational and educational purposes only and does not constitute financial, investment, or trading advice. ForexNews.site does not provide personalized investment recommendations. Readers should conduct their own research and carefully consider the risks before making any investment decision.

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