In the European market, dollar buying took the lead. Additionally, ECB Vice President De Guindos hinted at possible rate cuts by stating that ‘inflation has decreased significantly’ and that ‘if inflation converges toward the target, monetary policy will adjust accordingly.’ This caused the Euro to drop below 1.05, reaching 1.0497.
After that, some buying pushed it back up to 1.0582. However, in the New York market, continued dollar buying from the ‘Trump rally’ caused a pullback. Further, Fed Chair Powell’s cautious comments on rate cuts led to more dollar buying, pushing the Euro down again to around 1.05.
While the Fed is gradually maintaining its rate-cut policy, the ECB seems more open to rate cuts, especially with German political concerns in the background, making it hard to stop the Euro’s decline. However, since the Euro has fallen over 400 points since last week and today is the weekend, it’s essential to watch for possible buybacks and adjustments.
EUR/USD Predicted Range: 1.0600 – 1.0450
Please note that the above information does not guarantee profits. Make trading decisions at your own discretion.