EUR/USD Steadies as Fed Stays Pat, ECB Concerns Linger
The Fed holds rates steady with an upbeat economic outlook, while ECB concerns over euro strength and subdued inflation keep pressure on EUR/USD.
EUR/USD eased back today after recent strength as sentiment shifted modestly toward the U.S. dollar. The Federal Reserve held rates unchanged as expected, with Chair Powell maintaining a tight-lipped stance that produced a muted market response — EUR/USD briefly dipped below 1.1900 before recovering to around 1.1940. The Fed's upbeat tone on economic conditions has cast some doubt on the timing of future rate cuts, offering modest support to the greenback.
The euro’s broader advance has also been tempered by fresh commentary from ECB policymakers warning that rapid euro appreciation could dampen inflation and complicate monetary policy, a reflection of underlying growth headwinds in the region. While consumer confidence and business sentiment showed pockets of resilience earlier this month, broader price pressures remain subdued and below target, keeping market focus on the ECB's reluctance to tighten further.
EUR/USD Daily Price History
In the above chart, EUR/USD rates have quickly regained the bullish uptrend from the January, March, and November 2025 lows, surging to their highest level since June 2021. The consolidative action from last summer can now be interpreted as a bullish pennant. Despite today’s pullback, EUR/USD rates are holding the first key support level should the breakout continue, the September 2025 high at 1.1919. Failure below 1.1919 by the end of the month would likewise put into question the year-long uptrend again; until then, momentum appears to favor the upside.
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