EUR/USD was almost unchanged on Tuesday during the North American session after hitting a multi-year high of 1.1830, before dropping below the 1.1800 level. The approval of US President Donald Trump's "One Big Beautiful Bill" and higher US Treasury yields limited the rise in the shared currency, which remained trading around 1.1780, flat.

Recently, the US Senate passed Trump's tax bill by a 51-50 vote, with Vice President JD Vance casting the tie-breaking vote. Now the $3.3 trillion tax and spending bill heads to the US House of Representatives, which will approve the fiscal package, which "contains the president's entire legislative agenda in one package," according to Bloomberg.

Meanwhile, data suggests that the Federal Reserve's current moderate stance is justified by the state of the US economy. The latest Job Openings and Labor Turnover Survey (JOLTS) for May revealed that the labor market remains solid, with more openings than previously estimated. Meanwhile, the Institute for Supply Management (ISM) Manufacturing PMI improved but remained in contraction territory for the past four months.

Meanwhile, central bankers in Portugal made headlines. Fed Chair Jerome Powell stuck to a wait-and-see script on inflation-prone rates, while noting that he could not say whether a July cut was likely.

European Central Bank (ECB) officials made comments suggesting that inflation is getting lower and the interest rate path is tilted toward a cut. ECB Vice President Luis De Guindos added that EUR/USD parity above 1.2000 would be "complicated," he said in a Bloomberg interview. Other policymakers took a more neutral stance, preferring to keep interest rates unchanged.

Across the pond, the Eurozone Harmonized Index of Consumer Prices (HICP) in June was in line with estimates and May data. S&P Global said that manufacturing activity in the bloc improved but remained in contraction. (alg)

Source: FXstreet