Euro rose in European trade on Friday against a basket of major rivals, extending its recovery for a second day against the dollar off seven-week lows after European inflation data hurt the odds of early ECB interest rate cuts in April.
The dollar is losing ground ahead of the crucial US payrolls report for January, expected to offer fresh pricing for the likelihood of a Fed interest rate cut in March 2024.
EUR/USD
EUR/USD rose 0.15% to 1.0887, with a session-low at 1.0864, after rising 0.5% on Thursday, moving away from a seven-week trough at 1.0780.
European Inflation Data
Recent data showed euro zone inflation rose 2.8% in January, slowing down from 2.9% in December, but higher than estimates of 2.7%.
Core consumer prices rose 3.3% in the euro zone last month, down from 3.4%, but above estimates of 3.2%.
Such data hurt the odds of an early ECB interest rate cut in April, in turn boosting the euro.
The Dollar
The dollar index fell 0.1% on Friday, extending gains for another session against a basket of major rivals.
Later today, official US payrolls and wages data will be released, crucial for gauging the likely path ahead for US monetary policies.
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