EUR/USD opened the week hovering around the 1.1300 mark, caught in a choppy consolidation phase. The pair has struggled to gain momentum, with Euro traders finding it difficult to trigger a fresh move in either direction.
European economic data remains sparse this week, with the final Purchasing Managers Index (PMI) data unlikely to offer any major surprises. Pan-European Retail Sales figures, due early Wednesday, are expected to disappoint, adding to the lack of catalysts for the Euro. As a result, traders’ attention is shifting to this week’s key Federal Reserve (Fed) rate decision.
The Fed is widely expected to keep interest rates unchanged at its meeting, a move that is likely to invite further criticism from the Trump administration, which has been pressuring Fed Chair Jerome Powell for early rate cuts. While labor and inflation data appear balanced, the unpredictable trade policies from the White House create uncertainty, hindering the chances for the Fed to ease rates. The central bank remains focused on managing unemployment and price stability.
Although a rate hold by the Fed seems almost certain, Powell’s post-meeting remarks will be crucial for market participants. Investors are keen to detect any signs of a potential shift toward a rate-cutting cycle, with traders particularly alert to any dovish signals from the Fed.
EUR/USD Price Forecast
EUR/USD has been trapped in a volatile range between 1.1500 and 1.1200 in the near term. Despite a lack of fuel for Euro bulls, a broad selloff of the US Dollar has kept the pair from breaking lower. The Euro is currently trading above the 200-day Exponential Moving Average (EMA) near 1.0800, but recent highs above 1.1500 remain elusive. With resistance on both sides, the next significant move in either direction faces substantial fundamental hurdles.
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