EUR/USD steadies below 1.2050, eyes on FOMC Minutes

• EUR/USD dropped to its lowest level in nine days.
• US Dollar Index consolidates daily gains around 91.00.
• FOMC will release February meeting minutes at 1900 GMT.

After spending the first half of the day in a relatively tight range below 1.2100, the EUR/USD pair came under renewed bearish pressure in the early American session and slumped to its lowest level in nine days at 1.2024. As of writing, the pair was losing 0.52% on the day at 1.2042.

USD preserves its strength

In the absence of significant macroeconomic data releases from the euro area, the USD's market valuation remained the primary driver of EUR/USD's movements on Wednesday.

The risk-averse market environment and the upbeat data from the US helped the greenback outperform its rivals. The US Dollar Index (DXY), which dropped to a multi-week low of 90.11 on Tuesday, posted impressive gains and rose above 91.00 for the first time in more than a week. 

The US Census Bureau reported earlier in the day that Retail Sales in January increased by 5.3% to $568.2 billion and surpassed the market expectation for an increase of 1% by a wide margin. Meanwhile, Wall Street's main indexes opened deep in the negative territory and provided an additional boost to the DXY. At the moment, the S&P 500 is down 0.5% on a daily basis at 3,912.

Later in the session, the FOMC will publish the minutes of its February meeting. However, investors don't expect the statement to deliver any new information regarding the Fed's policy outlook.

Technical levels to watch for