EUR/USD consolidates losses with bullish attempts limited below 1.0700 zone

• Euro holds above 1.0600 support, with bullish attempts limited below 1.0690
• The overall bias remains unchanged, with the pair in a downtrend from early March highs near 1.1000.
• Divergent monetary policy outlooks between the ECB and the Fed are expected to keep the pair under pressure.

Euro bears have held back at the 1.0605 support zone this week, but the pair continues to trade sideways, with bullish attempts limited below 1.0690. The pair is on track to close the week little changed, following a 1.8% drop in the previous week.

A somewhat weaker US dollar gave oxygen to the common currency on Friday, although the general bearish trend remains. Divergent monetary policy outlooks between the ECB and the Fed are expected to weigh on the pair.

This week's data has supported the view of a “non-landing” of the US economy, strengthening the case for the Fed's hawkish side. On Friday, Chicago Fed President Austen Goolsbee He reiterated that progress on inflation has stalled and that it will take longer than expected to reach the 2% target. The Dollar has reacted with a moderate appreciation.

By contrast, ECB President Lagarde suggested that interest rate cuts will likely come in June. This puts the European Central Bank in the unusual position of acting before the Fed, which is likely to keep the Euro under pressure.