The EUR/USD fell to the 1.0680 region on Wednesday following the release of the German GfK Consumer Confidence Survey for July, which unexpectedly declined. The lack of significant data during the American trading session left investors to focus on the Federal Reserve’s cautious stance, which has led to a reduction in rate cut expectations.

The German consumer confidence index dropped to -21.8 for July, missing the forecast of a recovery to -18.9 from the previous month’s revised -21.0. Despite a slow recovery trend in the German GfK Consumer Confidence Survey, Wednesday’s disappointing print further weakened the already struggling Euro.

In the US, New Home Sales Change for May showed an 11.3% decline month-over-month on Wednesday, compared to a revised 2.0% increase from the initial print of -4.7%.

Confidence survey releases will continue on Thursday, with key data points for the pan-EU Business Climate, Consumer Confidence, and Economic Sentiment Indicator scheduled for release during the European market window. US Durable Goods Orders, first-quarter Gross Domestic Product (GDP) revisions, and weekly Initial Jobless Claims will follow during the American trading session.

US GDP is expected to show a slight increase to 1.4% from the initial print of 1.3%, while May’s Durable Goods Orders are anticipated to show a -0.1% contraction compared to the previous month’s revised 0.6% growth. Initial Jobless Claims for the week ending June 21 are forecasted to decrease slightly to 236K from the previous 238K, but are expected to remain above the four-week average of 232.75K.

The US Core PCE Price Index inflation is expected to decline year-over-year to 2.6% from the previous 2.8%, as market participants hope for further signs of easing inflation to encourage the Federal Reserve towards rate cuts.

Confidence in a rate cut from the Federal Open Market Committee (FOMC) on September 18 has decreased. The probability of at least a quarter-point rate cut has fallen to around 60%, down from just above 70% last week, according to the CME’s FedWatch Tool.