• EUR/USD is trading a little higher on Tuesday after selling off steeply on the previous day. 
• Expectations the Federal Reserve will cut interest rates in December are weighing on the US Dollar. 
• The Euro, meanwhile, is facing pressure from French political risk and similar rate-cut bets for December.

EUR/USD recovers on Tuesday, with a single Euro (EUR) buying about 1.0510 US Dollars (USD) as morning breaks along the east coast of America. 

The US Dollar (USD) is trading down against the Euro (EUR) after various members of the US Federal Reserve (Fed) said on Monday, that they thought the labor market and inflation were now in balance and, as such, the Fed should continue to cut interest rates. Lower interest rates are negative for a currency as they reduce foreign capital inflows. 

Fed Governor Christopher Waller came the closest to outright advocating for a cut, after saying he was leaning “toward supporting a cut in December.” 

This helped solidify bets for the Fed making a 25 basis points interest-rate cut at its December policy meeting. The CME FedWatch tool calculates the probability of such a move as 72.5% on Tuesday, up from around 65% before his comments.