EUR/USD dips below mid-1.0800s ahead of Eurozone CPI and US PCE Price Index

• EUR/USD is attracting new sellers on Thursday as the US dollar strengthens modestly.
• The US dollar benefits from bets that the Fed will cut interest rates less and US Treasury yields will rise.
• A lower likelihood of aggressive ECB easing could limit losses for the currency pair.

EUR/USD encountered some supply during Thursday's Asian session, eroding some of the previous day's gains to the 1.0870 area, the highest in a week and a half. The decline was fueled by the appearance of some US dollar (USD) bullish buying, pushing spot prices below the mid-1.0800 range over the past hour.

Newly released US macro statistics suggest that the economy remains strong and support the outlook for a easing of aggressive easing by the Federal Reserve, which will support US dollar demand. Contributes to recovery. In fact, ADP reported Wednesday that private sector employers added 233,000 new jobs in October. Increased employment is expected to boost consumer spending and contribute to overall growth, supporting the view that the Fed will proceed with small interest rate cuts.

Separately, initial estimates from the U.S. Bureau of Economic Analysis showed the world's largest economy grew at an annualized pace of 2.8% in the April-June period, slower than 3% in the previous quarter. Ta. However, this had little impact on expectations about the Fed's rate cut path. In addition, concerns about a widening US budget deficit have pushed up US Treasury yields, helping the US dollar prevent a correction from a three-month high and putting pressure on the EUR/USD pair.

Meanwhile, euro zone statistics released on Wednesday showed that inflationary pressures in Germany remain tenacious. Moreover, the eurozone powerhouse's economy unexpectedly grew by 0.2% sequentially in the third quarter. This has forced investors to hold back on bets on a big interest rate cut by the European Central Bank (ECB), with some pressure on the common currency and the EUR/USD pair ahead of Thursday's release of preliminary euro zone consumer inflation figures. There is a possibility that this will provide support.

Then, the early US personal consumption expenditure (PCE) price index in North America could provide new clues about the Fed's interest rate outlook, pushing up US Treasury yields. Separately, broader risk sentiment will drive demand for the safe-haven greenback and help create short-term trading opportunities around the EUR/USD pair.