Growing adepts for a US central bank 25 bps rate hike boosted the USD

Wall Street trades with a risk-off-tilted mood. The economic docket in the United States (US) and the Eurozone (EU) is light, with the main driver of EUR/USD’s price action being the US 2-year Treasury bond yield. The US 2-year bond yield is gaining almost 10 bps, sitting at 4.194%, while the CME FedWatch Tool shows odds for a 25 bps rate hike by the Fed, at 84.7%, higher than last Friday’s 78%.

The US Dollar Index (DXY) continues to advance and tests the 20-day EMA around 102.321. A break above it could expose the 103.000 mark.

Data-wise, the New York Factory Empire State Manufacturing Index unexpectedly jumped in April, from -24.5 to 10.8, exceeding forecasts for a -18 plunge. Orders and shipments rising were the reasons behind the expansion, while a measure of prices paid fell 9 points.

On the Eurozone front, inflation in Italy rose by 7.6%, beneath the consensus and below February’s 9.1%. In the meantime, the European Central Bank (ECB) President, Christine Lagarde, is crossing newswires, but she’s not commenting about monetary policy.