Euro Dips on Fears of ECB Rate Cut Amid Middle East Tensions

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The dollar held onto its biggest gains in a week on Wednesday after an Iranian missile attack on Israel drove the buying of safe haven assets as investors fretted about the widening of conflict in the Middle East.

The euro was little changed against the dollar at $1.1069, following its largest drop in nearly four months on Tuesday at 0.6%.

The euro’s fall on Tuesday was also driven by increased bets that the European Central Bank will cut interest rates in October, after data showed euro zone inflation fell more than expected to 1.8% in September.

The focus turns to U.S. private payrolls data due later on Wednesday, with traders also monitoring a dispute at U.S. ports. The most important data point of the week is the U.S. employment report for September on Friday.

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This article was written by Ryan Paisey at www.forexlive.com.