EUR/USD remains steady during the North American session on Friday, poised to end the week with modest gains of over 0.18% as traders brace for the next week's monetary policy decision by the Federal Reserve (Fed). At the time of writing, the pair trades at 1.1736, virtually unchanged.

Euro ends week modestly higher as soft US data cements rate cut bets, narrowing policy divergence with ECB

US economic data continued to drive price action on Friday as Consumer Sentiment in September deteriorated, while inflation expectations remain above the Fed's 2% goal. This, and the payrolls revision on Tuesday and higher than foreseen Initial Jobless Claims report, would be the reasons behind the first rate cut by the Fed in nine months.

Market participants have fully priced in a 25-basis-point rate cut at the September 16-17 meeting. Across the pond, the European Central Bank (ECB) held rates unchanged, adopting a meeting-by-meeting and data-dependent approach, while not pre-committing to a set path on interest rates.

Given the backdrop, the EUR/USD bias is tilted to the upside as the interest rate differential between the US and Europe will trim. The divergence between both central banks and the deterioration of the labor market in the US could prompt investors to buy the shared currency, also as a haven.

Breaking news revealed that a DC Circuit laid out a briefing schedule for this weekend, to determine whether Governor Lisa Cook can remain at the Fed, while challenging Trump's attempt at removal, revealed Wall Street Journal reporter Nick Timiraos.

Next week, the US economic docket will feature the FOMC meeting and Retail Sales. In Europe, investors will eye ECB speeches, Eurozone Industrial Production and the ZEW Survey for the bloc.

Source: Fxstreet