• EUR/USD attracts some buyers for the second straight day amid subdued USD price action.
• The divergent Fed-ECB policy expectations turn out to be a key factor supporting the pair.
• Traders now look to the final German Q3 GDP print and US macro data for a fresh impetus.

The EUR/USD pair edges higher for the second consecutive day on Tuesday, though it lacks follow-through buying and remains confined in the previous day's broader range. Spot prices currently trade around the 1.1525-1.1530 region, up less than 0.10% for the day.

The recent comments from Federal Reserve (Fed) officials lifted market bets for another rate cut in December, which keeps the US Dollar (USD) depressed below its highest level since late May and acts as a tailwind for the EUR/USD pair. New York Fed President John Williams described the current policy as modestly restrictive and told reporters last Friday that the central bank can still cut interest rates in the near term.

Adding to this, Fed Governor Christopher Waller said on Monday that available data showed the US job market remains weak enough to warrant another quarter-point rate cut at the December policy meeting. Traders were quick to react and are now pricing in around 80% chances that the Fed will lower borrowing costs next month, which, along with a generally positive risk tone, undermines the safe-haven buck.

The shared currency, on the other hand, seems to draw support from bets that the European Central Bank (ECB) is done cutting interest rates. In fact, a majority of economists expect that the ECB will hold its deposit rate this year and see no change by the end of next year. This turns out to be another factor supporting the EUR/USD pair and backs the case for some meaningful appreciating move in the near term.

Traders now look forward to the release of the final German Q3 GDP for some impetus. Meanwhile, the US economic docket features the delayed release of the US Producer Price Index (PPI) and monthly Retail Sales data, along with Pending Home Sales and Richmond Manufacturing Index. This might influence the USD price dynamics and produce some short-term trading opportunities around the EUR/USD pair.