The EUR/USD pair weakened to around 1.1480 during the early Asian session on Monday (6/23). The greenback moved higher against the Euro (EUR) as US President Donald Trump's decision to join Israel's war against Iran sharply escalated the conflict. Traders will be closely monitoring developments surrounding the Middle East conflict.

The United States (US) waded into the conflict between Israel and Iran over the weekend, with American warplanes and submarines targeting three Iranian facilities in Iran, Fordo, Natanz, and Isfahan. Trump said Iran's main nuclear enrichment facility had been "totally destroyed" and warned of a "much bigger" attack unless Iran agreed to peace. The escalation in tensions after the US bombed an Iranian nuclear site boosted safe-haven currencies such as the Greenback and acted as a drag on the major currency pair.

Across the ocean, the European Central Bank (ECB) cut interest rates for the eighth time in a year earlier this month to support the sluggish recovery in the Eurozone but clearly signaled a pause in July. ECB President Christine Lagarde said that the rate cuts are coming to an end as the central bank is now "well-positioned" to deal with the uncertainty. The ECB's aggressive tone could help limit the euro's losses in the near term. (alg)

Source: FXstreet