The euro was at $1.0745, down 0.3%, having hit a five-week high of $1.0786 overnight, as German inflation rose to its highest level in nearly half a century in May on the back of soaring energy and food prices.
Eurozone CPI data is due later on Tuesday, and CBA analysts said the German data implied a possibility that this could come in above expectations as well. He added, however, that there was no certainty that the Federal Reserve would pivot away from an aggressive pace of tightening, and pointed to hawkish remarks overnight from Fed governor Christopher Waller, noting “so this trend of a weaker dollar could reverse”.
News that European Union leaders agreed in principle on Monday to cut most oil imports from Russia by the end of this year, sent oil prices higher, and boosted commodity currencies.The Australian dollar bounced from its $0.7163 low, also helped by better-than-expected PMI data from China and was last around $0.7180.
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