The US Dollar took a sharp turn after weak US manufacturing data which concerns about slowing economic growth.
October 2, 2019, | AtoZ Markets – The EURUSD pair initially moved lower and touched the 28-month lows on Tuesday following the release of softer Euro-zone inflation figures. The estimates showed that the headline CPI slowed further to 0.9% yearly rate in September as compared to 1.0% previous.
On the other hand, USD buying interest through the mid-European session gained some additional downward pressure.
As per the EURUSD charts, the pair moved back closer to weekly tops but lacked any strong bullish sign yet. The pair is oscillating in a narrow trading band, just below mid-1.0900s during the Asian session on Wednesday.
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EURUSD Fundamental outlook
The US Dollar took a sharp turn after weak US manufacturing data which concerns about slowing economic growth. In fact, the US ISM manufacturing PMI dropped to 47.8 in September, down from 49.1 previous. It also missed consensus estimates pointing to a reading of 50.1.
This is worst since June 2009 and supports fears of a US recession, forcing investors to start pricing in a higher probability of yet another interest rate cut by the Fed in October.
The market prediction was further reinforced by a sharp drop in the US Treasury bond yields, which again added to the intraday USD weakness.