The major currency pair has slipped even lower by Thursday. The current EURUSD exchange rate stands at 1.0495.
This places the US dollar at a ten-month high. The primary reason behind this trend is the strong market belief in the Federal Reserve's prolonged period of elevated interest rates.
In this context, the yield on the 10-year Treasury bonds remains at its peak since 2007.
Last week, the Federal Reserve warned that it might raise borrowing costs again by the end of the year. It also notified capital markets of its intention to keep interest rates at a high level for an extended period.
The US is better positioned than other countries to endure this extended period, leading investors to shed their overly optimistic expectations for other currencies and turn to the dollar.