EUR/USD looks wary, clings to 1.0700 ahead of the ECB


  • EUR/USD comes under pressure near 1.0700.
  • German 10y Bund yields approach 1.40%.
  • The ECB is expected to keep the policy rate unchanged.

The single currency wobbles between gains and losses and motivates EUR/USD to trade within a volatile note around the 1.0700 region on Thursday.

EUR/USD focuses on the ECB

EUR/USD trades in an unresolved fashion so far on Thursday, gyrating around the 1.0700 neighbourhood amidst rising cautiousness ahead of the ECB event later in the session.

Indeed, the central bank is expected to leave the policy rate unchanged (for the last time?), while bets for a hawkish tone from both the Council and Chair Lagarde at her subsequent press conference remain on the rise. On the latter, it could be a big disappointment for bulls otherwise.

Nothing other than the ECB gathering in the domestic calendar, whereas the usual weekly Claims are due across the pond.

What to look for around EUR

EUR/USD continues to trade in a side-lined mood near 1.0700 for the time being.

The pair’s recent multi-week recovery has been on the back of supportive ECB-speak, which continued to point at an initial rate hike as soon as in July, while the consensus view that the bond-purchase programme should end at some point in early Q3 has also lent legs to the European currency.

However, EUR/USD is still far away from exiting the woods and it is expected to remain at the mercy of dollar dynamics, geopolitical concerns and the Fed-ECB divergence, while higher German yields, persistent elevated inflation in the euro area and a decent pace of the economic recovery in the region are also supportive of an improvement in the mood around the euro.

Key events in the euro area this week: ECB Interest Rate Decision (Thursday).

Eminent issues on the back boiler: Speculation of the start of the hiking cycle by the ECB as soon as this summer. Asymmetric economic recovery post-pandemic in the euro bloc. Impact of the war in Ukraine on the region’s growth prospects.

EUR/USD levels to watch

So far, spot is losing 0.01% at 1.0715 and a breach of 1.0627 (monthly low June 1) would target 1.0532 (low May 20) en route to 1.0459 (low May 18). On the other hand, immediate up barrier emerges at 1.0786 (monthly high May 30) seconded by 1.0933 (100-day SMA) and finally 1.0936 (weekly high April 21).

Share: Feed news

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Recommended content


Recommended content

Editors’ Picks

EUR/USD stays in tight range near 1.0400 ahead of US data

EUR/USD stays in tight range near 1.0400 ahead of US data

EUR/USD moves sideways at around 1.0400 on Thursday. The pair struggles to gain traction as US President Trump's tariff threats against the EU and expectations for a dovish ECB outlook make it difficult for the Euro to find demand ahead of US data. 

EUR/USD News
GBP/USD turns lower to near 1.2300 as US Dollar stabilizes ahead of data

GBP/USD turns lower to near 1.2300 as US Dollar stabilizes ahead of data

GBP/USD has come under renewed selling pressure and battles 1.2300 in the European trading hours on Thursday. The pair meets supply as the US Dollar stabilizes and traders digest US President Trump's tariff talks, gearing up for the mid-tier US economic data later in the day. 

GBP/USD News
Gold price sticks to negative bias, remains close to multi-month peak set on Wednesday

Gold price sticks to negative bias, remains close to multi-month peak set on Wednesday

Gold price (XAU/USD) remains depressed through the first half of the European session on Thursday and for now, seems to have snapped a three-day winning streak to its highest level since early November touched the previous day. 

Gold News
Bitcoin edges below $102K ahead of mid-tier US data and Trump’s tariff threats

Bitcoin edges below $102K ahead of mid-tier US data and Trump’s tariff threats

Bitcoin’s (BTC) price continues to decline, trading below $102,000 at the time of writing on Thursday after falling 2.3% the previous day. Later in the day, BTC could expect volatility after the US weekly Initial Jobless Claims data release.

Read more
Netflix posts record quarter, as Trump talks tariffs on China

Netflix posts record quarter, as Trump talks tariffs on China

There has been a positive tone to risk this week, as the market digests Trump 2.0. However, Trump is not the only show in town. Earnings reports are also a key driver of stock indices, and the news is good.

Read more
Trusted Broker Reviews for Smarter Trading

Trusted Broker Reviews for Smarter Trading

VERIFIED Discover in-depth reviews of reliable brokers. Compare features like spreads, leverage, and platforms. Find the perfect fit for your trading style, from CFDs to Forex pairs like EUR/USD and Gold.

Read More

Forex MAJORS

Cryptocurrencies

Signatures