- The EUR/USD goes back from the maximum of 1,1447, operating plane about 1,1423 on Tuesday.
- Commercial conversations between the US and China in London are described as “good” but lack concrete progress.
- ECB officials point out the end of the flexibility cycle; They expect clarity about the impact of tariffs.
- The US CPI data and the ECB Wage Tracker could boost the next important movement.
The EUR/USD remains stable during the American session on Tuesday while investors expect updates on commercial conversations between the US and China in London and the publication of the latest inflation figures in the United States (USA). At the time of writing, the pair is quoted at 1,1423, practically unchanged.
Washington and Beijing continued their second day of discussions, which, despite being promoted as “good” by US President Donald Trump, fail to sustain the optimistic mood of the operators. Meanwhile, the speculation that both parties would reach common land to relieve tensions drove the US dollar (USD).
Among the topics discussed between the two parties are rare earths, chips exports and student visas. Meanwhile, operators assimilated the latest data publications, since the feeling of small businesses in the US improved, as revealed by the optimism index of the National Federation of Independent Business (NFIB).
On the other side of the Atlantic, the confidence of the Sentix investors of the Eurozone improved in June, since the index became positive for the first time in the year. The officials of the European Central Bank (ECB) crossed the cables, with Yannis Stournaras saying that the stable policy of the European Union (EU) attracted investors to the euro.
Boris Vujcic of the ECB said they could not affirm whether the US tariffs are uninflationary or inflationary, adding that the ECB could expect new projections. Olli Rehn of the ECB favors the idea of ​​a meeting by meeting, and Francois Villery commented that the ECB has successfully normalized politics.
Therefore, the recent turn in Villeroy’s comments, along with the comments of President Christine Lagarde that the rates are close to the end of the flexibility cycle, could push the EUR/USD upwards.
The eyes of the operators are put in the US inflation report, the ECB and Wage Tracker speakers.
Euro price this week
The lower table shows the percentage of euro change (EUR) compared to the main currencies this week. Euro was the strongest currency against pound sterling.
| USD | EUR | GBP | JPY | CAD | Aud | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.23% | 0.25% | 0.06% | -0.03% | -0.31% | -0.37% | 0.11% | |
| EUR | 0.23% | 0.46% | 0.28% | 0.18% | -0.06% | -0.15% | 0.32% | |
| GBP | -0.25% | -0.46% | -0.10% | -0.27% | -0.51% | -0.61% | -0.14% | |
| JPY | -0.06% | -0.28% | 0.10% | -0.09% | -0.42% | -0.49% | -0.07% | |
| CAD | 0.03% | -0.18% | 0.27% | 0.09% | -0.30% | -0.34% | 0.14% | |
| Aud | 0.31% | 0.06% | 0.51% | 0.42% | 0.30% | -0.09% | 0.39% | |
| NZD | 0.37% | 0.15% | 0.61% | 0.49% | 0.34% | 0.09% | 0.48% | |
| CHF | -0.11% | -0.32% | 0.14% | 0.07% | -0.14% | -0.39% | -0.48% |
The heat map shows the percentage changes of the main currencies. The base currency is selected from the left column, while the contribution currency is selected in the upper row. For example, if you choose the euro of the left column and move along the horizontal line to the US dollar, the percentage change shown in the box will represent the EUR (base)/USD (quotation).
What moves the market today: the EUR/USD operates volatile before the US inflation report.
- The US NFIB Optimism Index rose from 95.8 in April to 98.8 in May, exceeding its long -term average. This marked the end of a four -month drop in feeling and conditions for small US businesses, which had been affected by uncertainty around tariffs.
- The US consumer prices (CPI) is expected to rise a 2.5% year -on -year in May, from 2.3%, while the underlying CPI, which excludes food and energy, is expected to rise from 2.8% to 2.9% year -on -year, pointing out more persistent inflation pressures.
- The EU Sentix trust index improved 0.2% in June after falling to -8.1 in May and -19.5 in April.
- Financial market participants do not expect the ECB to reduce their deposit installation rate at 25 basic points (PB) at the July monetary policy meeting.
EURO TECHNICAL PERSPECTIVE: The EUR/USD clings to 1,1400 while buyers lose impulse
The EUR/USD price action suggests that the upward trend remains at stake, but until now, buyers have failed to exceed 1.15, which would immediately expose the maximum of the year to date (YTD) of 1,1572. The impulse, measured by the relative force index (RSI), suggests that consolidation be coming, since buyers take a respite.
On the other hand, the bassists would intervene if the EUR/USD falls below the single mobile (SMA) of 20 days of 1,1331, clearing the way for a challenge of 1.13 and the 50 -day SMA in 1,1281.
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.
