EUR/USD remains practically flat on Monday’s early European opening, trading at 1.1665 at the moment of writing. The pair bounced at 1.1650 earlier on the day, favoured by a somewhat brighter market mood, but weaker-than-expected German producer inflation data has crippled the pair’s frail upside attempts.
Investors sighed with relief as US President Donald Trump acknowledged on Friday that raising tariffs on China to 100%, as he threatened two weeks ago, is unsustainable. Beyond that, US Treasury Secretary Scott Bessent confirmed that same day that he will meet Chinese Vice Premier He Lifeng this week, which suggests that the world’s two major economies are looking to de-escalate their trade disputes.
In the US, concerns of bad loans at regional banks, which rattled markets late last week, seem to have subsided as quarterly earnings show that credit and revenues among large banks remain solid. This has contributed to improving the market sentiment, adding pressure on the safe-haven US Dollar.
In the Eurozone, German Producer Prices Index (PPI) MoM contracted against expectations for the third consecutive month in September, which is likely to add weight to the Euro. Apart from that, the economic calendar will be thin on Monday in Europe, with the speeches of the European Central Bank (ECB) board members Isabel Schnabel and Joachim Nagel as the only events worth mentioning, while in the US, there will be no relevant releases.
Euro Price Today
The table below shows the percentage change of Euro (EUR) against listed major currencies today. Euro was the strongest against the Canadian Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.09% | 0.02% | 0.06% | 0.07% | -0.00% | -0.20% | -0.12% | |
| EUR | 0.09% | 0.12% | 0.14% | 0.16% | 0.10% | -0.11% | -0.01% | |
| GBP | -0.02% | -0.12% | 0.04% | 0.03% | -0.03% | -0.23% | -0.13% | |
| JPY | -0.06% | -0.14% | -0.04% | 0.00% | -0.05% | -0.32% | -0.18% | |
| CAD | -0.07% | -0.16% | -0.03% | -0.00% | -0.01% | -0.28% | -0.18% | |
| AUD | 0.00% | -0.10% | 0.03% | 0.05% | 0.00% | -0.22% | -0.08% | |
| NZD | 0.20% | 0.11% | 0.23% | 0.32% | 0.28% | 0.22% | 0.10% | |
| CHF | 0.12% | 0.00% | 0.13% | 0.18% | 0.18% | 0.08% | -0.10% |
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 Euro from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent EUR (base)/USD (quote).
Daily digest market movers: The Euro fails to appreciate despite the brighter market mood
- The improved market sentiment has provided some support to the Euro, as the US Dollar gives away gains, but the pair’s recovery is lacking fundamental drivers, which leaves price action trapped within Friday’s range. The pair seems to be looking for direction, with investors wary of selling the US Dollar, awaiting further news about the US-China trade relationship.
- Economic figures released by Destatis on Monday revealed that the Producer Price Index (PPI) edged 0.1% down in Germany in September, against market expectations of a 0.1% increase. These figures follow declines of 0.5% and 0.1% in August and July, respectively. Year-on-year, the PPI fell 1.7%, following a 2.2% contraction in August.
- Macroeconomic data from China released earlier on Monday revealed that the Gross Domestic Product grew at a 1.1% pace in the third quarter, beating expectations of a 0.8% increase, while industrial production yearly accelerated to 6.5%, and Retail Sales YoY increased 3% in September, both of them beating expectations and showing that the economy remained resilient in the face of higher tariffs from the US. The positive risk sentiment has boosted China proxies AUD and NZD, while weighing on the US Dollar.
Technical Analysis: EUR/USD is testing reverse trendline, near 1.1650
EUR/USD hit the target of the Double Bottom pattern at 1.1730 last week and pulled lower. The pair is now testing the broken trendline support at the 1.1650 area, which keeps holding bears for now, although upside attempts remain limited. The 4-hour Relative Strength Index (RSI) is hovering around the 50 level, which shows a lack of clear bias.
A confirmation below the mentioned 1.1650, which is also the area where bulls were capped on October 9 and 15, would put bears in control and increase pressure towards the October 15 low, near 1.1600, and the October 14 low in the area of 1.1545. On the upside, intraday highs are at 1.1675, well below Friday’s high, near 1.1730. An unlikely rally beyond these levels would bring the October 1 high, around 1.1775, back into play.
Euro FAQs
The Euro is the currency for the 19 European Union countries that belong to the Eurozone. It is the second most heavily traded currency in the world behind the US Dollar. In 2022, it accounted for 31% of all foreign exchange transactions, with an average daily turnover of over $2.2 trillion a day.
EUR/USD is the most heavily traded currency pair in the world, accounting for an estimated 30% off all transactions, followed by EUR/JPY (4%), EUR/GBP (3%) and EUR/AUD (2%).
The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy.
The ECB’s primary mandate is to maintain price stability, which means either controlling inflation or stimulating growth. Its primary tool is the raising or lowering of interest rates. Relatively high interest rates – or the expectation of higher rates – will usually benefit the Euro and vice versa.
The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde.
Eurozone inflation data, measured by the Harmonized Index of Consumer Prices (HICP), is an important econometric for the Euro. If inflation rises more than expected, especially if above the ECB’s 2% target, it obliges the ECB to raise interest rates to bring it back under control.
Relatively high interest rates compared to its counterparts will usually benefit the Euro, as it makes the region more attractive as a place for global investors to park their money.
Data releases gauge the health of the economy and can impact on the Euro. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the single currency.
A strong economy is good for the Euro. Not only does it attract more foreign investment but it may encourage the ECB to put up interest rates, which will directly strengthen the Euro. Otherwise, if economic data is weak, the Euro is likely to fall.
Economic data for the four largest economies in the euro area (Germany, France, Italy and Spain) are especially significant, as they account for 75% of the Eurozone’s economy.
Another significant data release for the Euro is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period.
If a country produces highly sought after exports then its currency will gain in value purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.
