The euro held steady as market participants remained cautious ahead of the European Central Bank's policy meeting. Following a rate cut in June, the ECB is expected to maintain current interest rates, adopting a wait-and-see approach amidst uncertainty. Investors are split on the timing of future moves influenced by US-EU trade tensions. The euro may benefit from a weaker dollar, but potential trade negotiation failures could affect sentiment and growth, leading to higher demand for government bonds, impacting the euro's yield.
Market participants are cautious ahead of the ECB policy meeting, with the euro holding steady as a 'wait-and-see' approach prevails among policymakers amid global uncertainty.
Policymakers are widely expected to keep interest rates unchanged following June's rate cut, while the timing of future moves depends on US-EU trade developments.
The euro could benefit from a weaker dollar as investors assess US policies' impact on the economy, while monitored trade negotiations could affect sentiment.
Traders are focused on the ECB's communication; a dovish outlook may pressure the euro, while a cautious tone could offer continued support.
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