Local Recovary for the USD ahead of Friday’s NFP

On Monday the greenback rose slightly from record lows against the EUR as investors were focusing on a fresh batch of economic data which is expected to be released during the week. Yesterday, the USD went up 0.4% to 1.4217 against the EUR, pulling back from record highs of 1.4281 earlier in the session. Despite the Dollar’s recovery on Monday, its outlook remains bearish and investors will probably continue the sell off if U.S. data continues to disappoint. Yesterday’s US Institute of Supply Management Manufacturing data showed a weak sentiment for the domestic economy, with the key industrial indicator falling for the third consecutive month. Meanwhile, Interest Rate futures show traders expect a 0.25% point rate cuts at the Fed’s next two monetary policy meetings on October 31 and December 11. On the contrary, some analysts believe that a further interest-rate cut will probably reduce investing in the U.S. currency, especially while other major banks not keeping up the pace with the Fed’s active rate cuts.
Pending Home Sales are on tap today along with the U.S Domestic Vehicle Sales. Pending Home Sales Index measures the number of signed real estate contracts for existing single-family homes. The expectations for the Pending Home Sales release are currently standing at -2.0%, with the previous figure of -12.2%. However, the impact if the Pending Home Sales report on EUR/USD may be limited as traders will be anxiously awaiting Friday’s non-farm payrolls report which is expected to be more price shaking than ever after last month drop of 4K jobs.