According to Jinshi Data, ING analyst Francesco Pesole said that if the Federal Reserve meeting prompts the market to raise expectations for rate cuts and the U.S. non-farm payrolls data released on Friday is weaker than expected, the euro may close higher against the U.S. dollar this week.

While data on Wednesday may show that euro zone core inflation fell to an annualized 2.8% in July from 2.9% in June, that may not be enough for markets to price in the 55 basis point rate cut for 2024 already baked into the euro overnight index swap curve.