EURUSD is rising today on the back of mixed macroeconomic data from the U.S. economy. Markets received a very weak October reading of consumer sentiment, disappointing Richmond Fed data, and lower-than-expected core producer price inflation, both year-over-year and month-over-year. The softer data was further reinforced by a weaker-than-forecast retail sales report, leading investors to conclude that a December Fed rate cut now appears highly likely. As these expectations shift, EURUSD moves higher, with the probability of a Fed cut surging from under 20% last week to nearly 80% today. The dollar is weakening.
Additionally, media reports citing sources familiar with the search for the next Fed chair suggest that Kevin Hassett — considered by many to be one of Trump’s most loyal allies — is becoming the frontrunner. As a result, markets are increasingly convinced that Trump’s “dovish” policy stance will be carried forward by the next Fed leader. Treasury Secretary Bessent indicated that the new Fed chair will likely be chosen before Christmas, and one of their key tasks will be to “simplify” and standardize Fed policy — a direction that aligns with deregulation, something applauded by Wall Street and frequently praised by Hassett.
EURUSD (D1 timeframe)
EURUSD has bounced from the 200-day EMA (red line) and is approaching 1.158, forming a double bottom around 1.152. The short-term trend appears to support further gains toward 1.162.
Source: xStation5
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