Euro softens below 1.1600 as markets price in Fed rate hike
The EUR/USD pair declines to near 1.1585 during the early Asian session on Monday. The pair extends the decline amid aggressive Federal Reserve (Fed) rate-hike bets following hotter US inflation reports. Traders brace for the Fed interest rate decision later on Wednesday. The US Consumer Price Index (CPI) accelerated in August, reinforcing expectations that the US central bank will raise interest rates next week. Data released by the Bureau of Labor Statistics on Friday showed that the US CPI rose 0.4% MoM in August, putting the 12-month increase at 3.4%. Both readings came in line with market expectations. Meanwhile, the core CPI, which excludes volatile food and energy prices, increased by 0.3% on a monthly basis, versus 0.2% prior, beating the forecast of 0.2%. Financial markets have priced in nearly a 91% probability of a quarter-point rate hike at the Feds September meeting, up from 72% before the US PPI data, according to the CME FedWatch tool. “There‘s no guarantee that the Fed will hike next week, but it’s hard to see how the central bank can justify leaving rates on hold,” said Chris Zaccarelli, chief investment officer for Northlight Asset Management. Discover more Finance NEWS Brokerages a daily close below this cluster would expose the pair to









