EUR/USD declined sharply in the early European session and touched its lowest level in three weeks at 1.0520 before staging a modest rebound. As of writing, the pair was trading at 1.0560, where it was still down nearly 1% on a daily basis.
The renewed US Dollar strength earlier in the day weighed heavily on EUR/USD. The risk-positive market environment, however, helped the pair limit its losses for the time being. At the time of press, US stock index futures were up between 0.4% and 0.8% on the day, pointing to a positive opening in Wall Street's main indexes.
In the meantime, the data from Germany revealed on Tuesday that inflation, as measured by the Consumer Price Index (CPI), declined to 8.6% on a yearly basis in December from 10% in November. This reading came in below the market expectation of 9% and made it difficult for the Euro to gather recovery momentum.
The renewed US Dollar strength earlier in the day weighed heavily on EUR/USD. The risk-positive market environment, however, helped the pair limit its losses for the time being. At the time of press, US stock index futures were up between 0.4% and 0.8% on the day, pointing to a positive opening in Wall Street's main indexes.
In the meantime, the data from Germany revealed on Tuesday that inflation, as measured by the Consumer Price Index (CPI), declined to 8.6% on a yearly basis in December from 10% in November. This reading came in below the market expectation of 9% and made it difficult for the Euro to gather recovery momentum.