EUR/USD extends recovery beyond 1.1830 as Powell testifies

• EUR/USD continues to edge higher in the American session.
• US Dollar Index stays deep in the negative territory below 92.50.
• FOMC Chairman Jerome Powell is delivering the Fed's semiannual Monetary Policy Report.

After staying below 1.1800 during the first half of the day, the EUR/USD pair capitalized on the renewed USD weakness and staged a decisive rebound. As of writing, the pair was up 0.5% on a daily basis at 1.1833.

DXY loses traction on Powell's remarks

In his prepared remarks for delivery at the congressional hearing on Wednesday, FOMC Chairman Jerome Powell reiterated that the Fed's monetary policy will continue to support the economic recovery. Moreover, Powell adopted a relatively dovish tone by noting that the job market is still a ways off from the progress needed to begin asset tapering.

When the Fed released the prepared statement in the early American session, the USD faced strong selling pressure and the US Dollar Index was last seen losing 0.4% on the day at 92.40.

FOMC Chairman Powell delivers semiannual Monetary Policy Report – live stream.

Meanwhile, the US Bureau of Labor Statistics reported that the Producer Price Index (PPI) jumped to 7.3% on a yearly basis in June from 6.6% in May, compared to analysts' estimate of 6.8%.

Earlier in the day, the data from the euro area showed that Industrial Production contracted by 1% in May but this print had little to no impact on the shared currency's performance against its major rivals.

Technical levels to watch for