EUR/USD Holds Steady at 1.0805 Amid ECB Rate Cut Speculations and Dovish Fed
The EUR/USD pair continues to display resilience, holding steady around 1.0805 and reaching a high of 1.0812, despite expectations
The EUR/USD pair continues to display resilience, holding steady around 1.0805 and reaching a high of 1.0812, despite expectations that the European Central Bank (ECB) will lower interest rates in June.
This upward trend is largely driven by a weakening U.S. dollar, influenced by a dovish stance from the Federal Reserve and underwhelming U.S. economic data.
In the United States, the dollar’s pressure is compounded by the first quarte
Federal Reserve Influences Dollar Dynamics
r’s nonfarm productivity growth, which was reported at a sluggish 0.3%, significantly below the forecasted 0.8%. The Federal Reserve’s recent decision to maintain interest rates steady at a range of 5.25%-5.50% further dampens the dollar’s strength. Fed Chair Jerome Powell’s comments have indicated no imminent rate hikes, aligning with a strategy to support economic growth over inflation concerns.
European Central Bank’s Anticipated Moves
On the European front, the ECB’s anticipated rate cut in June is expected as long as inflation trends towards the target of 2%. This policy move comes on the heels of the Eurozone’s economic growth unexpectedly rising by 0.3% in Q1, outpacing the predicted growth of 0.1%.
Key Economic Indicators and Events
This week, the EUR/USD price forecast could be influenced by several pivotal events:
- Eurozone Service Sector: Data releases include the German Final Services PMI and the French Final Services PMI, expected to remain stable around 53.3 and 50.5, respectively.
- US Economic Data: The U.S. will release figures on jobless claims, expected to hold at 208K, and speeches by FOMC members could provide further insights into the Fed’s future monetary policy.
- Investor Sentiment and Payrolls: In Europe, Sentix Investor Confidence and preliminary private payrolls in France will offer additional clues about the economic climate.
These events and data points provide a comprehensive backdrop for the EUR/USD price forecast, suggesting a cautious optimism among traders.
EUR/USD Price Forecast: Weekly Technical Outlook
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