• The Euro remains offered vs. the US Dollar in the wake of the Fed event.
• Stocks in Europe started Thursday session deep in the red.
• EUR/USD drops and rebounds from the vicinity of 1.0615.
• The USD Index (DXY) climbs further and reaches new highs.
• The Fed left the door open to another 25 bps rate hike before year-end.
• Usual weekly Initial Jobless Claims, Philly fed Index will take centre stage.
• The ECB’s Christine Lagarde speaks later in the session.

Following an early dop to fresh multi-month lows, the Euro (EUR) manages to trim part of those losses vs. the US Dollar (USD), prompting EUR/USD to regain the 1.0650 region in the wake of the opening bell in Europe on Thursday.

The Greenback extends its march north as investors keep digesting the FOMC event and reaches new six-month peaks near 105.70 when measured by the USD Index (DXY), trading just pips away from the YTD tops around 105.90 (March 8).

The so-far pullback in the pair comes in tandem with some corrective moves in the short end of the US yield curve vs. humble gains in the belly and the long end, while the 10-year bund yields regain the area of recent peaks near 2.75%.

It is worth recalling that following the hawkish hold by the Federal Reserve (Fed) at its meeting on Wednesday, Chief Powell emphasized that there is still a significant journey ahead in achieving the target inflation rate of 2%. Additionally, he stated that the FOMC decided to maintain the current interest rates in light of the progress made thus far but remains prepared to raise rates when deemed suitable.

Data-wise, in the euro area, advanced Consumer Confidence tracked by the European Commission is due, along with a speech by the ECB’s President C. Lagarde.

 In the US, usual weekly Initial Jobless Claims are due followed by the Philly Fed Manufacturing Index, the CB Leading Index and Existing Home Sales.

Daily digest market movers: Euro drops to new lows near 1.0600

• The EUR rebounds from fresh lows vs. the USD.
• US and German yields advance marginally so far on Thursday.
• The Fed left the door open to another 25 bps rate raise in the next months.
• The BoE meets later and is expected to hike rates by 25 bps.
• Markets now price in probable rate cuts by the Fed in Q3 2024.
• An impasse in the ECB’s hiking cycle appears to be gathering traction.
• Intervention fears surround the price action around USD/JPY.