EUR/USD Forecast and News
EUR/USD trims gains, nears 1.1700
The EUR/USD pair eases in the American afternoon and approaches the 1.1700 mark. The pair surged earlier in the day after the ECB left interest rates unchanged and upwardly revised inflation and growth figures. The US CPI rose 2.7% YoY in November, nearing Fed’s goal.
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EUR/USD Technical Overview
The 20-period Simple Moving Average (SMA) has flattened around price, while the 50-, 100- and 200-period SMAs rise at 1.1705, 1.1662 and 1.1608, keeping a bullish alignment with spot above them. The Relative Strength Index (14) stands at 54, neutral and edging higher.
Immediate resistance aligns at 1.1765 (mid-point of the ascending regression channel), followed by 1.1800-1.1810 (round level, upper limit of the ascending channel).
The lower limit of the ascending channel and the 50-period SMA form a support area at 1.1700-1.1700, followed immediately by the rising trend line near 1.1680. A close below the latter could attract technical sellers and trigger another lef lower toward the 100-period SMA near 1.1660.
Fundamental Overview
After spending the first half of the day under bearish pressure on Wednesday, EUR/USD stage a late rebound to close marginally lower. The pair stays quiet near 1.1750 in the European morning on Thursday as investors stay on the sidelines ahead of the European Central Bank's (ECB) monetary policy announcements and November inflation data from the US.
The ECB is widely anticipated to leave key rates unchanged after the last meeting of the year. Revised macroeconomic projections could influence the Euro's valuation. In case there is a positive revision to Eurozone growth expectations, investors could see this as a sign of a neutral/hawkish policy outlook next year. In this scenario, EUR/USD could regather its bullish momentum. Conversely, a downward revision to inflation forecasts, combined with a weaker growth outlook, could weigh on the Euro with the immediate reaction.
Following the ECB event, investors will pay close attention to the US inflation data. On a yearly basis, the Consumer Price Index (CPI) and the core CPI are forecast to rise by 3.1% and 3%, respectively, in November. In case the headline CPI comes in above the market expectation, the USD could hold its ground and cause EUR/USD to stretch lower. On the other hand, a soft CPI print could revive expectations for another Federal Reserve (Fed) rate cut in January and trigger another leg lower in the USD, opening the door for a bullish EUR/USD action in the American session.
According to the CME FedWatch Tool, markets are currently pricing in about a 25% probability of a 25-basis-points Fed rate cut next month.
SPECIAL WEEKLY FORECAST
Interested in weekly EUR/USD forecast? Our experts make weekly updates forecasting the next possible moves of the Euro-US Dollar pair. Here you can find the most recent forecast by our market experts:
EUR/USD: US employment, inflation data to shape market mood Premium
The EUR/USD pair surged to a fresh monthly high of 1.1762 in the second week of December, closing it with gains a handful of pips below the level. The advance was solely related to the US Dollar weakness, which was triggered by poor American data and the Federal Reserve monetary policy decision.
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Editors' picks
USD/JPY extends gains above 156.00 after the expected BoJ rate hike
USD/JPY sees a fresh leg higher and regains the 156.00 level in Friday's Asian trading. The Japanese Yen loses further ground, digesting the Bank of Japan's (BoJ) expected 25 bps rate hike to 0.75%. Traders now look to Governor Ueda's press conference for fresh directives.
AUD/USD remains sidelined above 0.6600 amid a steady US Dollar
AUD/USD steadies above 0.6600 in the Asian session on Friday, following the previous day's two-way price swings and a positive close. Against the backdrop of the RBA's hawkish stance, a positive risk tone is seen acting as a tailwind for the Aussie. The US Dollar looks to stabilize the softer US CPI-led slide, capping the pair's upside.
Gold declines despite Fed rate cut hopes as US inflation cools
Gold price keeps pushing lower below $4,350 in Asian trading hours on Friday. The precious metal stays in the red due to some profit-taking and weak long liquidation from shorter-term futures traders.
Bitcoin, Ethereum and Ripple correction slide as BoJ rate decision weighs on sentiment
Bitcoin, Ethereum, and Ripple are extending their correction phases after losing nearly 3%, 8%, and 10%, respectively, through Friday. The pullback phase is further strengthened as the upcoming Bank of Japan’s rate decision on Friday weighs on risk sentiment, with BTC breaking key support, ETH deepening weekly losses, and XRP sliding to multi-month lows.
Bank of England cuts rates in heavily divided decision
The Bank of England has cut rates to 3.75%, but the decision was more hawkish than expected, leaving market rates higher and sterling slightly stronger. It's a close call whether the Bank cuts again in February or March.
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EUR/USD Yearly forecast
How could EUR/USD move this year? Our experts make a EUR/USD update forecasting the possible moves of the euro-dollar pair during the whole year. Don't miss our 2025 EUR/USD forecast!
EUR/USD FORECAST 2025
In the EUR/USD 2025 Forecast , FXStreet Chief Analyst Valeria Bednarik suggests that the macroeconomic landscape favors the US Dollar (USD) over the Euro (EUR), with a potential return to parity between the currencies.
While Donald Trump’s upcoming presidency may introduce higher inflation-related risks for the United States (US), the US economy demonstrated the strongest pandemic recovery among G7 nations, as measured by GDP, starting under Trump’s previous administration and following under Joe Biden.
From a technical point of view, the EUR/USD pair faces a bearish outlook for 2025, with technical indicators suggesting further declines after breaking below key moving averages and encountering strong resistance near 1.1200. The pair could test the 1.0330 zone, with the potential for parity if selling pressure persists. While a bearish trend is most likely, a sudden EU economic recovery or US weakness could push the pair toward 1.0600, with a possible rally to 1.1000 later in the year, though not before mid-2025.
MOST INFLUENTIAL FACTORS IN 2025 FOR EUR/USD
The year will be politically marked by Trump’s return to the White House. A Republican government is seen as positive for financial markets, but Trump’s pledge to cut taxes and impose tariffs on foreign goods and services may introduce uncertainty to both the political and economic landscape.
In the Eurozone, attention will focus on political turmoil in Germany and France, the two largest economies in the bloc. Germany is set to hold snap elections following a no-confidence vote against Chancellor Olaf Scholz in the Bundestag.
Influential Institutions & People for the EUR/USD
The European Central Bank (ECB)
The European Central Bank (ECB) is the central bank empowered to manage monetary policy for the Eurozone. With its beginnings in Germany in 1998, the ECB’s mandate is to maintain price stability in the Eurozone, so that the Euro’s (EUR) purchasing power is not eroded by inflation. As an entity independent of individual European Union countries and institutions, the ECB targets a year-on-year increase in consumer prices of 2% over the medium term. Another of its tasks is controlling the money supply. This involves, for instance, setting interest rates throughout the Eurozone. The European Central Bank’s work is organized via the following decision-making bodies: the Executive Board, the Governing Council and the General Council. Christine Lagarde has been the President of the ECB since November 1, 2019. Her speeches, statements and comments are an important source of volatility, especially for the Euro and the currencies traded against the European currency.
ECB official website , on X and YouTubeThe Federal Reserve (Fed)
The Federal Reserve (Fed) is the central bank of the United States (US) and it has two main targets: to maintain the unemployment rate at its lowest possible levels and to keep inflation around 2%. The Federal Reserve System's structure is composed of the presidentially appointed Board of Governors and the partially appointed Federal Open Market Committee (FOMC). The FOMC organizes eight scheduled meetings in a year to review economic and financial conditions. It also determines the appropriate stance of monetary policy and assesses the risks to its long-run goals of price stability and sustainable economic growth. The FOMC Minutes, which are released by the Board of Governors of the Federal Reserve weeks after the latest meeting, are a guide to the future US interest-rate policy.
Fed official website , on X and FacebookChristine Lagarde
Christine Lagarde was born in 1956 in Paris, France. Lagarde, who graduated from Paris West University Nanterre La Défense, became President of the European Central Bank (ECB) on November 1, 2019. Prior to that, she served as Chairman and Managing Director of the International Monetary Fund (IMF) between 2011 and 2019. Lagarde previously held various senior ministerial posts in the Government of France: she was Minister of the Economy, Finance and Industry (2007-2011), Minister of Agriculture and Fishing (2007) and Minister of Commerce (2005-2007).
Lagarde on ECB's Profile and WikipediaJerome Powell
Jerome Powell took office as chairman of the Board of Governors of the Federal Reserve System in February 2018, for a four-year term ending in February 2022. He was sworn in on May 23, 2022, for a second term as Chairman ending May 15, 2026. Born in Washington D.C., he received a bachelor’s degree in politics from Princeton University in 1975 and earned a law degree from Georgetown University in 1979. Powell served as an assistant secretary and as undersecretary of the Treasury under President George H.W. Bush. He also worked as a lawyer and investment banker in New York City. From 1997 through 2005, Powell was a partner at The Carlyle Group.
Jerome Powell Fed's Profile and WikipediaECB NEWS & ANALYSIS
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About EUR/USD
The EUR/USD (or Euro Dollar) currency pair belongs to the group of 'Majors', a term used t o describe the most important currency pairs in the world. This group also includes GBP/USD, USD/JPY, AUD/USD , USD/CHF, NZD/USD and USD/CAD . The popularity of the Euro Dollar pair stems from its representation of two of the world’s largest economies: the Eurozone and the United States.
The EUR/USD is one of the most widely traded currency pairs in the Forex market, where the Euro serves as the base currency and the US Dollar as the counter currency. It accounts for more than half of the total trading volume in the Forex market, making gaps almost inexistent, let alone sudden reversals caused by breakaway gaps.
The EUR/USD is usually quiet during the Asian session, as economic data influencing the pair is usually released during the European or US sessions. Activity increases as European traders begin their day, leading to heightened trading volume. This activity slows around midday during the European lunch break but picks up again when US markets come online.
Related pairs
GBP/USD
The GBP/USD (or Pound Dollar) currency pair belongs to the group of 'Majors', referring to the most important and widely traded pairs in the world. The pair is also known as “the Cable”, a term originating in the mid-19th century that refers to the first transatlantic telegraph connecting Great Britain and the United States. As a closely watched and widely traded currency pair, it features the British Pound as the base currency and the US Dollar as the counter currency. For that reason, macroeconomic data from both the United States and the United Kingdom significantly impacts its price. One notable event that affected the volatility of the pair was Brexit.
USD/JPY
The USD/JPY (US Dollar Japanese Yen) currency pair is one of the 'Majors', a group of the most important currency pairs in the world. The Japanese Yen, known for its low interest rate, is frequently used in carry trades, making it one of the most traded currencies worldwide. In the USD/JPY pair, the US Dollar is the base currency and the Japanese Yen serves as the counter currency.
Trading USD/JPY is also known as trading the "ninja" or the "gopher", although the latter nickname is more frequently associated with the GBP/JPY pair. USD/JPY usually has a positive correlation with other pairs like USD/CHF and USD/CAD, as all three use the US Dollar as the base currency. The value of the pair is often influenced by interest-rate differentials between the two central banks: the Federal Reserve (Fed) and the Bank of Japan (BoJ).