Ella 
In the Asian market on Tuesday, the euro/dollar was unable to continue the good momentum of rebounding from the three-week low of 1.0800 the day before, and fluctuated within a narrow range. EUR/USD is currently trading around 1.0840, with little movement throughout the day, still subject to US dollar fluctuations.
The U.S. Dollar Index (DXY), which tracks the greenback against a basket of currencies, failed to attract buyers amid unclear signals about the Federal Reserve’s (Fed) interest rate cut path, despite a positive outlook for U.S. economic growth. The Fed said last week it would still cut interest rates by 75 basis points this year. That said, several Fed officials still raised concerns about stubbornly high inflation and stronger-than-expected U.S. economic data. This has therefore prevented traders from making new directional bets on the US dollar, causing EUR/USD to remain depressed and range-bound.
On the other hand, bets that the European Central Bank (ECB) will cut interest rates in June also weakened EUR/USD. Indeed, Italian Bank of Italy Governor Fabio Panetta said on Monday that the European Central Bank was moving towards cutting interest rates as inflation is falling rapidly and approaching its 2% target. In addition, Philip Lane, chief economist of the European Central Bank, pointed out that once the central bank has greater confidence that wage growth will slow down and inflation will return to the 2% target as scheduled, it can consider adjusting interest rates. This further limits the upside for EUR/USD.
