Ella 
EUR/USD rose to a daily high near 1.0890 on Tuesday, before market flows pushed EUR/USD back to a range near 1.0860. Key US data is coming up, with GDP and PCE price index inflation to be released on Thursday and Friday respectively.
German inflation is expected to fall from 0.5% to 0.2% in May as investors hope that inflation in major European economies will improve and continue to fall in time to push the European Central Bank (ECB) to cut interest rates by 25 basis points at its upcoming June rate call.
Investors have been struggling with when the Fed will start cutting interest rates. As early as December, the market expected the Fed to make as many as six rate cuts of at least 25 basis points each, and the Fed’s rate cuts are expected to take place in March, with a minimum rate cut of 25 basis points. Today, interest rate markets are roughly even on the probability of a 25 basis point rate cut by the Federal Reserve in September, while expectations of a total of two rate cuts in 2024 are shattering.
The annual rate of U.S. GDP in the first quarter, released on Thursday, is expected to fall back to 1.3% from the previous value of 1.6%. The monthly rate of U.S. PCE price index inflation, released on Friday, is expected to remain stable at 0.3%.
