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The EUR/USD maintains a bid tone at 1.0600 and moves little following the release of US macroeconomic data
The EUR/USD maintains its moderately bullish tone and responds little to the mixed US macroeconomic data. Continue to operate as a tailwind for the USD and act as a ceiling on the gains. Recent range-bound price activity necessitates prudence before putting direction bets.
Throughout the early North American session, the EUR/USD pair maintains a comfortable position above the 1.0600 round-figure level and moves little in response to the mixed US macroeconomic data.
In November, the US Bureau of Economic Analysis reported that the Personal Consumption Expenditure (PCE) Price Index grew only 0.1%, missing forecasts for a 0.3% increase. The modest disappointment was mitigated by the upward revision of the prior month's estimate to 0.4% and the higher-than-expected annual rate of 5.5%.
The Fed's favored inflation gauge, the Core PCE Price Index, increased by 0.2% month-over-month in November and slowed to 4.7% year-over-year from 5.0% previously. Separately, US Durable Goods Orders missed consensus projections by a wide margin, which fails to excite US Dollar bulls and provides no support for the EUR/USD pair.
However, continued suspicions that the Fed will maintain its ultra-hawkish approach in an effort to manage inflation continue to operate as a tailwind for the yields on US Treasury bonds. This should prevent any further USD losses and contain the EUR/USD pair's upside. Before putting fresh direction bets, investors should exercise prudence due to the ambiguous fundamental background.
Even from a technical standpoint, spot prices have oscillated within a well-known trading range during the previous week or two. This further indicates traders' hesitation, thus it is wise to await a sustained move in either direction to establish the EUR/USD pair's near-term direction.
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