EUR/USD Price Forecast: Fresh downside likely if sustain below 1.1455
- EUR/USD falls to near 1.1460 as the US Dollar outperforms its peers.
- Hawkish Fed repricing has strengthened the US Dollar.
- ECB President Lagarde rules out fears of second-round inflation effects.
The Euro (EUR) is down 0.12% to near 1.1460 against the US Dollar (USD) during the European trading session on Friday. The major currency pair is under pressure as the US Dollar extends the advance due to firm expectations that the Federal Reserve (Fed) will deliver more interest rate hikes this year.
In European trade, the US Dollar Index (DXY), which gauges the Greenback’s value against six major currencies, posts a fresh seven-week high near 100.50.
US Dollar Price Today
The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Japanese Yen.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.13% | 0.08% | 1.12% | 0.14% | -0.17% | 0.37% | 0.10% | |
| EUR | -0.13% | -0.05% | 1.07% | -0.01% | -0.33% | 0.27% | -0.03% | |
| GBP | -0.08% | 0.05% | 1.14% | 0.06% | -0.26% | 0.35% | 0.03% | |
| JPY | -1.12% | -1.07% | -1.14% | -1.01% | -1.35% | -0.77% | -1.07% | |
| CAD | -0.14% | 0.01% | -0.06% | 1.01% | -0.33% | 0.25% | -0.05% | |
| AUD | 0.17% | 0.33% | 0.26% | 1.35% | 0.33% | 0.60% | 0.29% | |
| NZD | -0.37% | -0.27% | -0.35% | 0.77% | -0.25% | -0.60% | -0.29% | |
| CHF | -0.10% | 0.03% | -0.03% | 1.07% | 0.05% | -0.29% | 0.29% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
Dollar outlook brightens on Fed repricing
Economists at UOB Group highlight that the bank’s revised expectation for “two further Fed rate hikes” marks a notable shift in the US rates landscape. They argue that the “narrowing of US rate differentials relative to G-10 peers – which have been weighing on the DXY since late 2024 – is likely to reverse and underpin the DXY going forward.”
Meanwhile, the Euro faces selling pressure as European Central Bank (ECB) officials push back fears of the emergence of second-round inflation effects for now, a scenario that eases concerns of an aggressive ECB monetary tightening cycle.
Earlier in the day, ECB President Christine Lagarde said, “Not seeing second-round effects yet.”
EUR/USD Technical Analysis
In the daily chart, EUR/USD trades at 1.1460, extending a bearish bias as spot holds below the 20-period exponential moving average (EMA) at 1.1561. The pair remains pressured by this overhead EMA, while the Relative Strength Index (RSI) at 32.8 hovers just above oversold territory, hinting that downside momentum is still dominant but may be losing some intensity.
On the topside, initial resistance is defined by the 20-day EMA at 1.1561, and a sustained break above this barrier would be needed to ease the current bearish tone and allow for a broader recovery. Looking down, the pair could extend the decline towatds the psychological level of 1.1500 if it falls decisively below the September 17 low at 1.1456.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Fed FAQs
What does the Federal Reserve do, how does it impact the US Dollar?
Monetary policy in the US is shaped by the Federal Reserve (Fed). The Fed has two mandates: to achieve price stability and foster full employment. Its primary tool to achieve these goals is by adjusting interest rates. When prices are rising too quickly and inflation is above the Fed’s 2% target, it raises interest rates, increasing borrowing costs throughout the economy. This results in a stronger US Dollar (USD) as it makes the US a more attractive place for international investors to park their money. When inflation falls below 2% or the Unemployment Rate is too high, the Fed may lower interest rates to encourage borrowing, which weighs on the Greenback.
How often does the Fed hold monetary policy meetings?
The Federal Reserve (Fed) holds eight policy meetings a year, where the Federal Open Market Committee (FOMC) assesses economic conditions and makes monetary policy decisions. The FOMC is attended by twelve Fed officials – the seven members of the Board of Governors, the president of the Federal Reserve Bank of New York, and four of the remaining eleven regional Reserve Bank presidents, who serve one-year terms on a rotating basis.
What is Quantitative Easing (QE) and how does it impact USD?
In extreme situations, the Federal Reserve may resort to a policy named Quantitative Easing (QE). QE is the process by which the Fed substantially increases the flow of credit in a stuck financial system. It is a non-standard policy measure used during crises or when inflation is extremely low. It was the Fed’s weapon of choice during the Great Financial Crisis in 2008. It involves the Fed printing more Dollars and using them to buy high grade bonds from financial institutions. QE usually weakens the US Dollar.
What is Quantitative Tightening (QT) and how does it impact the US Dollar?
Quantitative tightening (QT) is the reverse process of QE, whereby the Federal Reserve stops buying bonds from financial institutions and does not reinvest the principal from the bonds it holds maturing, to purchase new bonds. It is usually positive for the value of the US Dollar.