EUR/USD rebounds from initial decline as Iran signals openness to ceasefire

EUR/USD Recovers Amid Shifting Market Sentiment

The EUR/USD currency pair has managed to regain most of its earlier declines, climbing toward the 1.1625 level during Thursday’s European session, though it remains slightly lower overall. This rebound comes as investors’ appetite for safe-haven assets has lessened, following remarks from Iran’s Deputy Foreign Minister, Saeed Khatibzadeh. He indicated that Iran is open to ending hostilities with Israel and the United States and is willing to halt its nuclear ambitions if Washington proposes an attractive deal.

As reported by Sky Arabia, Khatibzadeh stated, “Iran is prepared to give up its nuclear program, provided the United States puts forward a compelling alternative.”

During European trading hours, the US Dollar Index (DXY)—which measures the dollar’s performance against a basket of six major currencies—rose by 0.15% to approach 99.00, though it has since given up much of those gains.

Additionally, expectations for a less dovish Federal Reserve stance have been reinforced by positive US economic data, which continues to bolster the US Dollar. On Wednesday, ADP reported that 63,000 new private sector jobs were created in February, surpassing both the forecast of 50,000 and the previous month’s figure of 11,000. The Services PMI also exceeded expectations, reaching 56.1 compared to the anticipated 53.5 and January’s 53.8.

Data from the CME FedWatch tool reveals that the probability of the Fed cutting interest rates at its July meeting has climbed to 50.2%, up from 37.9% earlier in the week.

Eurozone Retail Sales Update

In the Eurozone, retail sales slipped by 0.1% month-over-month in January, missing expectations for a 0.3% increase. For December, the figure was revised upward to a 0.2% gain from an initial estimate of a 0.5% decline.