Ella 
EUR/USD pared some gains.
European stock markets opened positively.
EUR/USD tests 1.0900 against the backdrop of a dollar recovery.
The US dollar index recovered from 103.00.
U.S. and German yields were slightly on the defensive.
German labor market reports for August were mixed.
France’s August flash CPI rose 1.0% month-on-month and 4.8% year-on-year.
The recent gains in the euro (EUR) against the U.S. dollar (USD) appear to have suffered somewhat, which pushed EUR/USD below the key 1.0900 level during the European morning on Thursday.
Meanwhile, the U.S. dollar index (DXY) rebounded from Wednesday’s two-week low near 103.00 as U.S. yields fell across the curve, with investors further repricing the pause in the Federal Reserve’s normalization process for the coming months.
Meanwhile, the rhetoric surrounding the Fed’s “tighter-longer” stance appears to have weakened after recent U.S. fundamental outcomes were weaker than expected.
In contrast, there is no news on a possible interest rate decision from the European Central Bank (ECB) after the summer.
Domestically, German retail sales shrank by 0.8% on month in July and by 2.2% over the past 12 months. The number of unemployed people in Germany increased by 18,000 in August, and the unemployment rate rose to 5.7%. Broader euro inflation data will be released later, ahead of the ECB’s accounts for its July 27 meeting.
In the US, all attention will be on the release of inflation data tracked by the PCE and core PCE for August, followed by the usual jobless claims, personal income, personal spending and a speech by Boston Fed President Susan Collins.
