- The EUR/USD pair is trading around 1.15270 USD per euro, under downward pressure due to monetary policy differences between the ECB and the Fed as well as the US government shutdown.
- Final inflation data from the eurozone, combined with weak price pressure in France, suggest that the ECB will maintain its current policy at least until year-end, supporting the euro.
- The Fed has not confirmed a further rate cut in December, which, together with fiscal uncertainty in the US, strengthens the dollar and affects the short-term dynamics of EUR/USD.
- The EUR/USD pair is trading around 1.15270 USD per euro, under downward pressure due to monetary policy differences between the ECB and the Fed as well as the US government shutdown.
- Final inflation data from the eurozone, combined with weak price pressure in France, suggest that the ECB will maintain its current policy at least until year-end, supporting the euro.
- The Fed has not confirmed a further rate cut in December, which, together with fiscal uncertainty in the US, strengthens the dollar and affects the short-term dynamics of EUR/USD.
The EUR/USD pair is currently trading around 1.15270 USD per euro. The market is under downward pressure, mainly due to differences in monetary policy between the European Central Bank and the US Federal Reserve.
Souce: xStation5
What is shaping the EUR/USD today?
The dollar remains relatively strong following the Fed’s recent 25 basis point rate cut. The central bank, however, signaled the possibility of pausing further reductions, which has strengthened the US currency and limited the euro’s gains. Investors expect the Fed to respond cautiously to upcoming economic data before making any decisions on potential further adjustments to monetary policy.
In the eurozone, market attention is focused on the latest macroeconomic releases. Preliminary inflation data for October showed the CPI at 2.1% year-on-year, while core inflation stood at 2.4% y/y. These results are in line with analyst expectations and suggest that the ECB is likely to maintain its current policy at least until the end of the year.
In France, data on inflation and industrial production were released. Annual inflation fell to 0.9% y/y, with minimal monthly price changes. Weak price pressure reduces the need for interest rate hikes, supporting the ECB’s monetary policy stability and providing backing for the euro.
Data releases from France and the eurozone as a whole are important for the EUR/USD pair, as they shape market expectations regarding future ECB decisions and may support the common currency amid growing global market uncertainty. At the same time, the Fed's caution and the lack of confirmation of further rate cuts in the US keep the dollar volatile, which affects the dynamics of the EUR/USD exchange rate in the short term.
US100 loses 0.5% 📉Meta shares decline extends on AI CAPEX worries & Deutsche Bank remarks
Fed's Bostic and Hammack comment the US monetary policy 🔍Divided Fed?
Scott Bessent sums up the US trade deal with China🗽What will change?
CHN.cash under pressure despite positive Trump remarks 🚩
The content of this report has been created by XTB S.A., with its registered office in Warsaw, at Prosta 67, 00-838 Warsaw, Poland, (KRS number 0000217580) and supervised by Polish Supervision Authority ( No. DDM-M-4021-57-1/2005). This material is a marketing communication within the meaning of Art. 24 (3) of Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU (MiFID II). Marketing communication is not an investment recommendation or information recommending or suggesting an investment strategy within the meaning of Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC and Commission Delegated Regulation (EU) 2016/958 of 9 March 2016 supplementing Regulation (EU) No 596/2014 of the European Parliament and of the Council with regard to regulatory technical standards for the technical arrangements for objective presentation of investment recommendations or other information recommending or suggesting an investment strategy and for disclosure of particular interests or indications of conflicts of interest or any other advice, including in the area of investment advisory, within the meaning of the Trading in Financial Instruments Act of 29 July 2005 (i.e. Journal of Laws 2019, item 875, as amended). The marketing communication is prepared with the highest diligence, objectivity, presents the facts known to the author on the date of preparation and is devoid of any evaluation elements. The marketing communication is prepared without considering the client’s needs, his individual financial situation and does not present any investment strategy in any way. The marketing communication does not constitute an offer of sale, offering, subscription, invitation to purchase, advertisement or promotion of any financial instruments. XTB S.A. is not liable for any client’s actions or omissions, in particular for the acquisition or disposal of financial instruments, undertaken on the basis of the information contained in this marketing communication. In the event that the marketing communication contains any information about any results regarding the financial instruments indicated therein, these do not constitute any guarantee or forecast regarding the future results.
