- The EUR / USD seems to end the third consecutive day on the upside.
- Dombrovskis, from EU, says ESM strongly supports Franco-German stimulus fund proposal
- The US dollar index stabilizes around 99.50 after the testimony of the president of the FOMC Powell.
After gaining almost 100 pips on Monday, EUR / USD hit Tuesday’s two-week high of 1.0976 on Tuesday. With trading action becoming moderate during the US session, the pair entered a consolidation phase and was last seen up 0.15% to 1.0928.
The optimistic mood of the market at the start of the week and the Franco-German proposal for stimulus funds boosted the shared currency. Earlier today, European Commission Vice-President Valdis Dombrovskis said the European Stability Mechanism (ESM) strongly supported the proposal. The Commission plans to present the proposal at the European summit scheduled for May 27.
Weak dollar persists
On the other hand, the greenback is struggling to find demand in the absence of important macroeconomic drivers. The only data from the United States revealed that housing starts in April fell at a record 30.2% in April, but were largely overlooked by market players.
In the meantime, FOMC President Jerome Powell refrained from making startling remarks about the economic or political outlook during his testimony before the Senate Banking Committee. Powell reiterated that the Fed remains committed to using all available tools to continue supporting the economy. Currently, the US dollar index shows small daily losses of almost 99.50.
On Wednesday, the European economic file will present data from the consumer price index for April. Later today, the FOMC will publish the minutes of its April 28-29 meeting.