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Forex News - EUR/USD rebounds toward 1.1750 with initial reaction to US CPI data

  • EUR/USD gained nearly 30 pips on renewed USD weakness.
  • US Dollar Index turned negative on the day below 93.00.
  • US annual CPI stayed unchanged at 5.4% in July.

After dropping toward 1.1700 earlier in the day, the EUR/USD pair managed to stage a sharp rebound in the early American session and was last seen rising 0.2% on the day at 1.1743.
DXY reverses direction after July inflation report

The renewed USD weakness seems to be helping EUR/USD gain traction in the second half of the day. The data published by the US Bureau of Labor Statistics revealed on Wednesday that the Consumer Price Index (CPI) stayed unchanged on a yearly basis at 5.4% in July. Moreover, the Core CPI edged lower to 4.3% as expected from 4.5% registered in June.

Breaking: US annual CPI inflation stays unchanged at 5.4% in July vs. 5.3% expected.

Although these prints came in largely in line with analysts' estimates, the initial market reaction put the greenback under modest selling pressure. As of writing, the US Dollar Index was down 0.18% on a daily basis at 92.90.

In the meantime, Richmond Federal Reserve Bank President Thomas Barkin told Reuters that it could take a few more months before they reach the Fed's taper benchmark.

Later in the session, Atlanta Federal Reserve Bank President Raphael Bostic will be delivering a speech. Additionally, the 10-year US Treasury note auction at 1700 GMT will be watched closely by market participants.

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