By Areena FxThe EUR/USD pair continues to see modest gains, buoyed by a weakening US Dollar (USD) and reduced expectations of rapid interest rate cuts by the European Central Bank (ECB). Despite concerns about the Eurozone’s economic outlook, positive sentiment persists due to recent comments from ECB policymakers indicating a cautious approach to rate cuts. Additionally, the USD’s downtrend further supports the EUR/USD pair.
Investors are awaiting key inflation data releases from both the Eurozone and the United States, including the flash CPI estimates and the US Personal Consumption Expenditures (PCE) Price Index. ECB President Christine Lagarde’s remarks on strong wage pressures and signs of growth stabilization have bolstered confidence in the Euro, counteracting recession risks in Germany.
Technical analysis suggests a bullish outlook for the EUR/USD pair, with potential resistance levels at 1.0865 and 1.0920. However, the 1.0800 mark remains a key support level, with a break below indicating vulnerability to further decline. Overall, market focus remains on data releases and central bank policies, shaping the pair’s short-term trajectory.
Euro price this week
The table below shows the percentage change of Euro (EUR) against listed major currencies this week. Euro was the strongest against the New Zealand Dollar.
| USD | EUR | GBP | CAD | AUD | JPY | NZD | CHF | |
| USD | -0.34% | -0.15% | -0.09% | 0.15% | -0.14% | 0.22% | -0.22% | |
| EUR | 0.34% | 0.19% | 0.25% | 0.48% | 0.19% | 0.57% | 0.12% | |
| GBP | 0.15% | -0.20% | 0.05% | 0.28% | -0.01% | 0.37% | -0.08% | |
| CAD | 0.10% | -0.25% | -0.06% | 0.24% | -0.07% | 0.32% | -0.13% | |
| AUD | -0.15% | -0.48% | -0.28% | -0.23% | -0.27% | 0.09% | -0.38% | |
| JPY | 0.16% | -0.18% | 0.05% | 0.07% | 0.31% | 0.39% | -0.07% | |
| NZD | -0.23% | -0.57% | -0.37% | -0.32% | -0.09% | -0.38% | -0.45% | |
| CHF | 0.23% | -0.12% | 0.07% | 0.13% | 0.38% | 0.07% | 0.45% |
Euro FAQs
What is the euro?
The Euro is the currency used in the Eurozone, which consists of 20 European Union nations. It is the world’s second most heavily traded currency, behind the US dollar. In 2022, it accounted for 31% of all foreign exchange transactions, with an average daily turnover of more than $2.2 trillion.
EUR/USD is the world’s most actively traded currency pair, accounting for around 30% of all transactions, followed by EUR/JPY (4%), EUR/GBP (3%), and EUR/AUD (2%).
What is the ECB, and how does it affect the euro?
The European Central Bank (ECB), headquartered in Frankfurt, Germany, serves as the Eurozone’s reserve bank. The European Central Bank sets interest rates and conducts monetary policy.
The ECB’s principal objective is to keep prices stable, which entails either managing inflation or encouraging growth. Its major tool is to raise or cut interest rates. Relatively high interest rates, or the prospect of rising rates, often boost the Euro, and vice versa.
The ECB Governing Council makes monetary policy decisions at eight sessions each year. Decisions are taken by the presidents of the Eurozone’s national banks and six permanent members, including ECB President Christine Lagarde.
How does inflation statistics affect the value of the Euro?
Eurozone inflation statistics, as assessed by the Harmonized Index of Consumer Prices (HICP), is an essential economic indicator for the Euro. If inflation increases faster than predicted, particularly over the ECB’s 2% objective, the ECB must boost interest rates to keep it under control.
Relatively high interest rates relative to its peers normally favor the Euro, making the area more appealing as a location for global investors to store their money.
How does economic data affect the value of the Euro?
Data releases provide insight into the economy’s health and may have an influence on the euro. GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys may all have an impact on the euro’s movement.
A healthy economy is advantageous for the Euro. Not only does it attract more foreign investment, but it may also urge the ECB to raise interest rates, so directly strengthening the Euro. Otherwise, if economic data is bad, the Euro is expected to decrease.
Economic statistics for the four major economies in the eurozone (Germany, France, Italy, and Spain) are particularly important since they account for 75% of the Eurozone’s GDP.
How does the trade balance affect the euro?
Another important data release for the Euro is the Trade Balance. This statistic calculates the difference between what a nation makes from exports and what it spends on imports in a particular time.
If a nation produces highly sought-after products, its currency will appreciate solely due to the increased demand produced by overseas purchasers looking to acquire these commodities. A positive net trade balance so enhances a currency, while a negative one weakens it.