Ella 
The EUR/USD pair continues to exhibit limited movement, trading in close proximity to the 1.0850 level for the fourth consecutive day, reflecting subdued market activity amid a lackluster agenda and investor caution.
Monday saw little excitement as anticipated, with the economic calendar offering minimal activity, highlighted only by the release of investor confidence data in the eurozone, which failed to yield any surprises.
The broader market sentiment remains consistent, with the majority of investors closely monitoring speculations regarding potential interest rate cuts by the Federal Reserve (Fed) and the European Central Bank (ECB).
Presently, attention is focused on the likelihood of three rate cuts, although the possibility of only two by the Fed is gradually gaining traction.
Despite the robust performance of the US labor sector, which significantly diminishes the likelihood of a recession, concerns persist regarding the sustainability of the downward trend in inflation.
The eagerly awaited US consumer inflation data scheduled for tomorrow is expected to influence market sentiment and potentially alter expectations regarding interest rate cuts.
The euro remains on the defensive, displaying characteristic resilience but facing challenges in generating a strong bullish momentum to surpass and sustain levels above 1.10.
Today, the prevailing scenario suggests continued narrow trading ranges, with investors exercising caution ahead of tomorrow’s pivotal data release. Additionally, focus remains on Thursday’s ECB meeting, where no changes in rates are anticipated, but President Lagarde’s remarks may provide new insights.
Market participants are advised to exercise prudence and avoid significant positions as they await crucial economic indicators that could steer market dynamics in the coming days.
