EUR/USD faces hurdles around 1.0260 on lower consensus for Eurozone Retail Sales
- EUR/USD is sensing barricades around 1.0260 as estimates for Eurozone Retail Sales shift lower.
- The DXY has hit a fresh three-week low as the recruitment process seems vulnerable in July.
- Eurozone's stable jobless rate may remain a hurdle for the ECB in hiking interest rates.
The EUR/USD pair has failed to violate the immediate hurdle of 1.0260 as investors are discounting an expected underperformance from the Eurozone Retail Sales data. The shared currency bulls seem to lack strength as the pair has been unable to perform despite broader weakness in the US dollar index (DXY).
A preliminary estimate for the Eurozone Retail Sales is -1.7%, extremely lower than the prior release of 0.2%. It is worth noting that households in Europe are facing the headwinds of higher price pressures, which are forcing them to higher consumption expenditure despite a minor change in quantity purchased. Therefore, the Retail Sales data should be higher. And, a lower estimate for the economic demand indicates a serious fall in the retail demand.
Also, the unchanged Unemployment Rate is going to act as a major hurdle for the European Central Bank (ECB) while brainstorming for a rate hike. Investors should be informed that Eurostat released the jobless rate at 6.6%, in line with the expectations and the prior release.
On the dollar front, the US dollar index (DXY) printed a fresh three-week low of 105.28 on Monday. The DXY extended its losses as investors have started punishing the DXY on expectations of weak US Nonfarm Payrolls (NFP) data. As per the market expectations, the US economy has managed 250k job additions in the labor force in July. Many US big tech companies have ditched the recruitment process for a while, whose multiplier effects could be witnessed in the payrolls data.