Euro declines below 1.1450 on US-Iran peace deal uncertainty

The EUR/USD pair trades with mild losses around 1.1425 during the early European session on Tuesday. The US Dollar (USD) edges higher against the Euro (EUR) amid risk-off sentiment and a hawkish Federal Reserve (Fed) stance. Traders will keep an eye on the preliminary readings of the Purchasing Managers Index (PMI) from Germany, the Eurozone and the United States (US) later on Tuesday. Traders positioned for a more hawkish Fed under the leadership of new Chair Kevin Warsh. Last week, the US central bank decided to leave its benchmark interest rate unchanged between 3.50% and 3.75%. Warsh said during the press conference that “price stability” would be the Fed’s guiding principle. Markets have priced in nearly an 89% chance of a Fed hike in December, up from 61% before last week’s FOMC meeting, according to the CME FedWatch tool. Meanwhile, uncertainty surrounding the US-Iran peace deal could boost the Greenback as a safe-haven currency. US Vice President JD Vance said on Monday that Iran agreed to admit nuclear monitors into the country after negotiations in Switzerland. However, Tehran denied making any new commitments. Washington will mediate another round of talks beginning Tuesday to end clashes in southern Lebanon between Iran-backed Hezbollah and Israel, according to a US State Department official.