EUR/USD aims higher towards the NY close, up 0.38% amid US dollar weakness.

• Euro aims higher in the session, closed up 0.38%.
• China’s covid containment measures brought down cases to zero.
• Dallas Fed Robert Kaplan backpedals on its bond tapering view, the Delta variant could change his judgment.

EUR/USD recovers last week’s losses, rose 0.38% and finished the NY session at 1.1746. A positive market sentiment caused by Fed’s Robert Kaplan “dovish” remarks, and China reporting zero local covid cases.

Dallas Fed President Robert S. Kaplan, one of the hawks in the Fed, said he is open to adjusting his view that the Fed should start tapering its asset-purchase program sooner rather than later if the Delta variant persists.

The US dollar began the week on the wrong foot, losing 0.50%, was last seen at 93.00. The appetite for high-yielding assets also hurt the US 10-year Treasury yield, down 29 basis points (bps) at 1.253%.

The IHS Markit PMI’s were released yesterday in the Euro area and in the United States. The Eurozone Flash Manufacturing PMI was worse than expected, at 61.5 versus a 62.0 foreseen. 
In regards to the services PMI, the reading came at 59.7 against 59.6 expected, a modest improvement. Although readings are good, risks to the outlook remain high. Supply shortages and bottlenecks are pushing up costs for companies and consumers. Meanwhile, as coronavirus cases rise, the fears of a slowdown in global growth, remain.

Contrarily in the United States, the IHS Markit Manufacturing PMI dropped to 55.4 from 59.9 in the last month. Concerning the Services PMI, it fell to 55.2 from 59.1.

In the Eurozone economic docket, tomorrow the German GDP figures are released. In regards to the US, the New Home Sales and the Richmond Manufacturing Index will be unveiled.

EUR/USD technical levels