Ella 
EUR/USD is off to a bad start to the new trading week.
European stock markets opened in the red on Monday.
EUR/USD eases back to the 1.0970 area on the back of the Fed and risk aversion.
The US dollar index regained the 102.00 mark and above.
German industrial production shrank 1.5% on month in June.
The euro (EUR) is on the stronger side against the U.S. dollar (USD) to start the week and force EUR/USD back into the sub-1.1000 area after Monday’s Old Continent open.
On the other hand, the dollar regained traction after retreating for two consecutive sessions while reclaiming the area above 102.00 as investors continued to digest Friday’s non-farm payrolls (+187K).
As far as the latter is concerned, it is worth recalling that despite the US economy creating fewer jobs than initially forecast, wage growth held steady and the unemployment rate fell to 3.5%, suggesting that the resilience of the labor market appears to be almost intact.
Aside from the general risk aversion, comments from FOMC Chair Michelle Bowman also seemed to underpin the dollar’s renewed buying bias, arguing that the dollar should be backed by stagnant deflationary pressures. Further rate hikes (at the next meeting?)
Bowman’s comments contrasted with growing speculation that the Fed’s July rate hike could be its last for the foreseeable future. Furthermore, the possibility of further tightening measures by the European Central Bank (ECB) after the summer appears to be losing steam.
