EUR/USD: Euro on a mild correction mode, but remains above 1,1700 level

Vasilis Tsaprounis Independent Analyst

The single European currency is trading in a mild tone after three days of upward movement as further rise and approach to 1,20 levels remains a significant challenge.

The overall market picture has not changed significantly, with the issue of trade tariffs and central bank decisions regarding interest rates remaining at the top of investors' agendas and will determine the course of the exchange rate in the second half of the year.

Some large investment houses see a continuation of the upward momentum of the European currency and for the second half of 2025, giving predictions for levels close to 1.25, but something about which I have several doubts.

The sluggish growth of the European economy combined with the possible imposition of trade tariffs by the United States is likely to create a critical dilemma regarding the exchange rate of the European currency, and levels well above 1.20 are likely to be considered problematic.

While at the same time the US dollar continues to offer much better interest rates and this gap in favor of US dollar is most likely to remain on the table for the coming months.

The confrontation between President Trump and Fed President Powell remains in the spotlight. Rumors of a possible removal of President Powell persist, but so far such a scenario does not seem the most likely.

Today's agenda is relatively weak, reinforcing the possibility of a narrow trading range in the exchange rate.

I prefer to remain in a wait-and-see position, but I am keeping the thought of a possible purchase of the US currency at the threshold of 1.20 as I estimate that a new wave of consolidation will appear and the pair will have to digest the new levels before the next move.

Author

Vasilis Tsaprounis

Independent Analyst

Vassilis Tsaprounis possesses over 25 years of professional experience in Capital Markets and especially in the foreign exchange market.

EUR/USD meets initial support around 1.1800

EUR/USD remains on the back foot, although it has managed to reverse the initial strong pullback toward the 1.1800 region and regain some balance, hovering around the 1.1850 zone as the NA session draws to a close on Tuesday. Moving forward, market participants will now shift their attention to the release of the FOMC Minutes and US hard data on Wednesday.

GBP/USD bounces off lows, retargets 1.3550

After bottoming out just below the 1.3500 yardstick, GBP/USD now gathers some fresh bids and advances to the 1.3530-1.3540 band in the latter part of Tuesday’s session. Cable’s recovery comes as the Greenback surrenders part of its advance, although it keeps the bullish bias well in place for the day.

Gold hangs near one-week low; looks to FOMC Minutes for fresh impetus

Gold is consolidating just above the $4,850 level, having touched a one-week low on Tuesday, amid mixed cues. Signs of progress in US–Iran talks dent demand for the traditional safe-haven bullion. Meanwhile, rising bets for more Fed rate cuts keep the US Dollar bulls on the defensive and act as a tailwind for the non-yielding yellow metal. Traders also seem reluctant ahead of the FOMC Minutes, which would offer cues about the Fed's rate-cut path and provide some meaningful impetus.

RBNZ set to pause interest-rate easing cycle as new Governor Breman faces firm inflation

The Reserve Bank of New Zealand remains on track to maintain the Official Cash Rate at 2.25% after concluding its first monetary policy meeting of this year on Wednesday.

UK jobs market weakens, bolstering rate cut hopes

In the UK, the latest jobs report made for difficult reading. Nonetheless, this represents yet another reminder for the Bank of England that they need to act swiftly given the collapse in inflation expected over the coming months.

Ripple slides to $1.45 as downside risks surge

Ripple edges lower at the time of writing on Tuesday, from the daily open of $1.48, as headwinds persist across the crypto market. A short-term support is emerging at $1.45, but a buildup of bearish positions could further weaken the derivatives market and prolong the correction.