Euro continues to bounce off 2-month peak against dollar

Euro tilted lower against the US dollar during the Asian session, to continue for the third straight session its bounce from the highest since August 14, ahead of major economic data release by the European and the US economies.

EUR/USD slipped 0.04% to 1.1120 as of 05:17 GMT, after opening at 1.1125, with the session-low at 1.1116, and the high at 1.1131.

Investors are anticipating the release of the European consumer confidence reading, with forecasts for the contraction to remain at -7, unchanged from September, in addition to Brussels' response to British Prime Minister Boris Johnson's request to extend the Brexit deadline by additional three months until the end of January.

The President of the European Council, Donald Tusk, stressed yesterday that the EU leaders are prepared for all the Brexit scenarios, but added that he told the British Prime Minister a no-deal Brexit will never be EU decision, while the President of the European Commission Jean-Claude Juncker noted that dealing with the Brexit negotiations had been a waste of time and efforts.

The Commission President also said that it was futile to waste more time in the Brexit negotiations, and said that Britain has to ratify the agreement first then Brussels. The European Union's chief Brexit negotiator Michel Barnier also said that a trade agreement with the UK may take up to two years or more, adding that the Brexit repercussions have hurt the British economy, and there is still a chance of a no-deal Brexit scenario.

Otherwise, the US economy will release it reading for the house price index (HPI), with forecasts of growth at 0.4% unchanged from previous reading for July, the US Department of the Treasury will also unveil its monthly federal budget statement, with forecasts of a surplus of $83.5 billion versus a deficit of $200.3 billion in August.