Market players await United States data for additional clues. Progress in trade talks continues to benefit the American currency. EUR/USD pressures

The Indian rupee is likely to open weaker on Tuesday, weighed down by a jump in the dollar index following a steep decline in the euro, as investors digested the implications of the recent US-EU trade deal.

“Further euro strength is likely to be self-defeating,” said Valentin Marinov, a currency strategist at Crédit Agricole, a French bank. Exports were already likely to weaken and become a drag on the eurozone economy because of U.S. tariffs and European government policies that would encourage more imports.

Euro falls against dollar, with Trump's tariffs seen as slowing European growth

The U.S. dollar was extending its bounce versus the euro for a second day on Tuesday, finding support on what currency strategists said appeared to be substantial short covering versus the euro following the U.

Euro breaks down -200 pips after invalidating the 4H FVG at 1.1739–1.1745, sliding toward the 1.1556 support zone. Rate differentials and strong U.S. data continue to favor the dollar, as the Fed’s 4.50% hold contrasts sharply with the ECB’s 2.15%.

The short-covering recovery in the US dollar has been extended today, but the momentum stalled in the European morning. Click to read.