Euro holds gains above 1.1600 on ECB tightening prospects
The EUR/USD pair trades with mild gains around 1.1625 during the early Asian session on Tuesday. The Euro (EUR) strengthens against the US Dollar (USD) amid expectations of a rate hike from the European Central Bank (ECB). Traders await the US Producer Price Index (PPI) and Consumer Price Index (CPI) inflation data later this week. The ECB delivered its first hike since 2023 in its June policy meeting to tame surging prices, but then hit pause at its last meeting in July to see how the conflict would develop. The ECB is set to hike its benchmark rate for the second time this year at its policy meeting on Thursday. “The ECB governing council looks certain to raise its deposit rate from 2.25 percent to 2.5 percent,” said Andrew Kenningham, chief Europe economist at Capital Economics. ECB President Christine Lagarde is expected to give little away at her press conference after the rate call and insist that future decisions will be based on incoming data. Across the pond, a stronger-than-expected US jobs report showed 162K job additions in August, pushing Federal Reserve (Fed) rate-hike bets above 60%. Additionally, ongoing Middle East tensions, including tit-for-tat strikes between the US and Iran on vessels sailing in the









