Ella 
In early Asian trading on Monday, the euro extended its losses against the dollar to around 1.0920. The risk aversion caused by the escalation of geopolitical tensions in the Middle East and regional conflicts has brought certain selling pressure on risky currencies such as the euro.
After the release of the U.S. Producer Price Index (PPI) last Friday, traders expected the Federal Reserve (Fed) to cut interest rates by 25 basis points in November. The CME FedWatch tool shows that the market is currently pricing in a probability of a 25 basis point interest rate cut by the Federal Reserve at close to 86.8%, which is higher than the 83.3% rate before the release of PPI data.
Across the pond, the euro zone is under pressure as the European Central Bank (ECB) is expected to cut interest rates further at its two remaining monetary policy meetings this year. The ECB’s dovish stance was exacerbated by a faster-than-expected decline in inflationary pressures in the euro zone and a “fragile” economic recovery.
You Might Be Interested In:
Australian Dollar Weakens On China Deflation Worries
9 Advantages of SGD Appreciation
10 Disadvantages of a Falling Rupee
