The EUR/USD pair held steady around 1.0295 during the early Asian session on Thursday (16/1). A cooler-than-expected US Consumer Price Index (CPI) inflation data for December raised bets that the US Federal Reserve (Fed) could cut interest rates twice this year, weighing on the greenback. However, growing concerns over the Eurozone economic growth may cap gains for the major currency pair.

The US dollar (USD) fell after the US core CPI data came in weaker than expected, fueling expectations that the Fed's easing cycle may not be over yet. Markets now expect the US central bank to deliver 40 basis points (bps) of interest rate cuts by the end of the year, compared to around 31 bps before the inflation data.

Across the pond, the European Central Bank (ECB) delivered four interest rate cuts last year, and traders are pricing in three or four moves this year amid concerns about the weak Eurozone economic outlook. Rising speculation of further rate cuts from the ECB could weaken the Euro (EUR) against the USD in the near term.

On Thursday, investors will be looking at the German Harmonized Index of Consumer Prices (HICP) for December and the ECB Monetary Policy Meeting Minutes. On the US data front, December Retail Sales and weekly Initial Jobless Claims will be in the spotlight. (AL)

Source: FXstreet