- EUR/USD regained ground on Tuesday, but continues below 1.1000.
- European data goes to the background while markets focus on betting bets and repercussions of commercial policy.
- The key data that will be published later this week include US inflation and consumer feeling figures.
The EUR/USD experienced a slight upward recovery on Tuesday, breaking a two -day loss streak and registering some last minute profits before the wide “reciprocal” tariffs of the Trump administration on April 9. The statements of the key officials are beginning to collide with the growing market expectations on features of the FED rates during the rest of 2025, putting markets in a collision course with the negative impacts of high range tariffs.
Forex today: Market attention moves towards the Fed minutes
In general, the European economic data calendar is light this week, and on Tuesday it provided a refreshing respite of the usual geopolitical and commercial news avalanche typical of recent weeks under the Trump administration. However, several important officials of the Federal Reserve (FED) took the moment to remind us that the uncertainty and the adverse inflationary effects of the US tariffs will complicate, and will not facilitate, the process of cutting the fees of the Fed.
The hopes of feat cuts of the Fed continue to increase
Without flinching for this, rates operators are increasingly betting that the Fed will be forced to start a cycle of feat cuts before the end of the year, since the negative economic repercussions of those same tariffs could push the US to a recession. CME Fedwatch tool data indicate that rates swap operators are beginning to speculate that a quarter -point cut could come as soon as in May. However, the majority of participants in the rate market still consider that a 25 basic points cut in July is more likely, anticipating a total reduction of 100 basic points or more by the end of the year.
GOLSBEE OF THE FED: Tariffs are much larger than anticipated
Daly of the Fed: I am a little worried that inflation can increase again
The inflation data of the Consumer Price Index (CPI) will be published on Thursday, while the results of the production price index (IPP) and the consumer’s feeling index of the University of Michigan (UOM) will be announced on Friday. This will represent the last set of significant figures of inflation and feeling of the US of the period ‘Pre-Arance’ of 2025, serving as critical reference points for the rest of the year.
EUR/USD price forecast
The EUR/USD cut a two -day loss streak on Tuesday, marking a short -term technical support level about 1,0900. However, the purchase pressure is still weak, and a slight thrust from the short side could easily lead to the 200 -day exponential mobile (EMA) average of 1,0700.
Despite a strong recovery of the euro during March, a strong resistance zone is still valued between 1,1100 and 1,1000.
EUR/USD daily graphics
Euro Faqs
The euro is the currency of the 19 countries of the European Union that belong to the Eurozone. It is the second most negotiated currency in the world, behind the US dollar. In 2022, it represented 31 % of all foreign exchange transactions, with an average daily business volume of more than 2.2 billion dollars a day. The EUR/USD is the most negotiated currency pair in the world, with an estimate of 30 %of all transactions, followed by the EUR/JPY (4 %), the EUR/GBP (3 %) and the EUR/AU (2 %).
The European Central Bank (ECB), based in Frankfurt (Germany), is the Eurozone reserve bank. The ECB establishes interest rates and manages monetary policy. The main mandate of the ECB is to maintain price stability, which means controlling inflation or stimulating growth. Its main tool is the rise or decrease in interest rates. Relatively high interest rates (or the expectation of higher types) usually benefit the euro and vice versa. The GOVERNMENT BOOK of the ECB makes decisions about monetary policy in meetings that are held eight times a year. The decisions are made by the directors of the National Banks of the Eurozone and six permanent members, including the president of the ECB, Christine Lagarde.
Eurozone inflation data, measured by the harmonized consumer prices index (IPCA), are an important economic indicator for the euro. If inflation increases more than expected, especially if it exceeds 2% of the ECB, it forces the ECB to rise interest rates to control it again. Relatively high interest rates compared to their counterparts usually benefit the euro, since they make the region more attractive as a place for global investors to deposit their money.
Published data measure the health of the economy and can have an impact on the euro. Indicators such as GDP, manufacturing and services PMIs, employment and consumer trust surveys can influence the direction of the single currency. A strong economy is good for the euro. Not only attracts more foreign investment, but it can encourage the ECB to raise interest rates, which will directly strengthen the euro. Otherwise, if economic data is weak, the euro is likely to fall. The economic data of the four largest economies in the euro zone (Germany, France, Italy and Spain) are especially significant, since they represent 75% of the economy of the euro area.
Another important fact that is published on the euro is the commercial balance. This indicator measures the difference between what a country earns with its exports and what you spend on imports during a given period. If a country produces highly demanded export products, its currency will gain value simply by the additional demand created by foreign buyers seeking to buy those goods. Therefore, a positive net trade balance strengthens a currency and vice versa in the case of a negative balance
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
