On Wednesday, The euro rebounded, snapping five days of losses as reports that Italy plans to cut its budget deficit after next year eased concerns over the prospect of a wider deficit that had rattled markets.
EUR/USD was up 0.23% to 1.1573 by 04:05 AM ET (08:05 AM GMT), rebounding from Tuesday’s one-and-a-half month trough of 1.1504.
Italian newspapers reported that Italy’s populist government will reduce its budget deficit targets for 2020 and 2021 to 2.2% and 2% respectively and stick with its plan for 2.4% for 2019.
The government had originally said it would planned to run a deficit of 2.4% over the next three years which would have breached European Union fiscal rules, spooking markets and prompting criticism from the European Commission.
The dollar was slightly softer against a currency basket, with the U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, sliding 0.16% to 94.99.
Investors were looking ahead to data on the ISM non-manufacturing index and ADP non-farm payrolls later in the day, ahead of Friday’s U.S. government non-farm payrolls report for indications that the economy remains on track./investing.com