EUR/USD Advances Above 1.12 as Fed Chair Warsh Tempers October Hike Bets

The euro strengthened above 1.12 against the US dollar, trading near 1.1238, as the greenback slumped following remarks by Federal Reserve Chair Kevin Warsh. Speaking at an IMF gathering in Bangkok, Warsh declined to provide explicit guidance or signal an urgent rate hike for the October 27-28 FOMC meeting. His omission of hawkish forward guidance led money markets to price in an 83.9% to 85% probability of an interest rate pause, overriding hotter-than-expected US inflation data, including September's 6.3% headline PPI print. The US Dollar Index slid toward 101.69, providing support to EUR/USD.