Ella 
In early trading in Asia on Tuesday, the EUR/USD was below the mid-range of 1.0800, recovering some of its losses. A slight decline in the U.S. dollar and lower U.S. bond yields helped EUR/USD rebound. Investors are awaiting fourth-quarter gross domestic product (GDP) data from Germany and the euro zone ahead of Wednesday’s Federal Reserve meeting. EUR/USD is currently trading around 1.0841, up 0.09% on the day.
Peter Kazimir, a member of the European Central Bank’s (ECB) Governing Council, said the central bank would not rush to cut interest rates to avoid undoing progress on inflation. Casimir added that it was risky to act quickly to deal with short-term surprises before the medium-term outlook became clearer. In addition, François Villeroy de Galhau, President of the Bank of France, said that the European Central Bank will cut interest rates this year and that various options are available at the next meeting on March 7 possible.
Eurozone fourth-quarter gross domestic product is due to be released on Tuesday and is expected to contract at a 0.1% quarterly rate and hold steady on an annual basis. If the report shows weaker-than-expected results, it could create some selling pressure on the euro (EUR) and be negative for EUR/USD.
In the United States, the Federal Reserve (Fed) is likely to keep key interest rates steady for the fourth consecutive time. However, the Fed is likely to cut interest rates by 25 basis points in March. Futures traders see a 45.9% chance of the Fed delivering its first rate cut of the cycle at its March meeting, according to the CME FedWatch tool.
Looking ahead, German and Eurozone fourth-quarter GDP data will be released on Tuesday. In the United States, the U.S. JOLTS job openings and Conference Board consumer confidence index will be released. The focus will turn to Wednesday’s Federal Reserve meeting.
