EUR/USD Forecast: Euro rebounds but struggles to gather momentum
- EUR/USD stays below 1.1000 following Monday's volatile action.
- The near-term technical outlook points to a lack of bullish momentum.
- Markets will remain focused on tariff headlines in the absence of high-impact data releases.
After rising to 1.1050 on Monday, EUR/USD lost its traction and closed the day slightly above 1.0900. The pair holds its ground early Tuesday and clings to modest daily gains at around 1.0950.
Euro PRICE Today
The table below shows the percentage change of Euro (EUR) against listed major currencies today. Euro was the strongest against the US Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.26% | -0.18% | -0.28% | -0.51% | -1.30% | -1.15% | -0.14% | |
| EUR | 0.26% | 0.04% | -0.06% | -0.26% | -1.03% | -0.85% | 0.11% | |
| GBP | 0.18% | -0.04% | -0.09% | -0.27% | -1.07% | -0.88% | 0.15% | |
| JPY | 0.28% | 0.06% | 0.09% | -0.22% | -1.00% | -0.89% | 0.20% | |
| CAD | 0.51% | 0.26% | 0.27% | 0.22% | -0.80% | -0.62% | 0.44% | |
| AUD | 1.30% | 1.03% | 1.07% | 1.00% | 0.80% | 0.19% | 1.24% | |
| NZD | 1.15% | 0.85% | 0.88% | 0.89% | 0.62% | -0.19% | 1.05% | |
| CHF | 0.14% | -0.11% | -0.15% | -0.20% | -0.44% | -1.24% | -1.05% |
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).
In an interview with Fox News on Monday, Kevin Hassett, Director of the US National Economic Council (NEC), said US President Donald Trump will listen to trading partners if they offer "really great deals." Later in the day, several news outlets, including Reuters, reported that Hassett told CNBC that Trump is considering a 90-day pause in tariffs for all countries except China. The immediate reaction to this headline boosted the risk mood and helped EUR/USD push higher.
As the White House came out with a statement shortly after, calling the CNBC reporting "fake news," the risk rally quickly lost its steam and made it difficult for EUR/USD to keep its footing.
Meanwhile, European Union trade commissioner Maros Sefcovic said on Monday that they have offered zero-for-zero tariffs to the US for cars and all industrial goods. "The EU remains open to and strongly prefers talks but we will not wait endlessly," he noted.
The economic calendar will not offer any high-impact data releases that could influence EUR/USD's action on Tuesday. Hence, market participants will continue to scrutinize the fresh developments on the global trade conflict.
While it's difficult to know what will be the next tariff-related headline, the action in Wall Street could provide a directional clue for EUR/USD. A bullish action in US stocks after the opening bell could support the pair and vice versa.
EUR/USD Technical Analysis
The Relative Strength Index (RSI) indicator on the 4-hour chart stays near 50, reflecting a lack of bullish momentum.
If EUR/USD fails to stabilize above 1.0950 (static level), 1.0900 (static level, round level) could be seen as the next support before 1.0870 (100-period Simple Moving Average (SMA), 20-day SMA). On the upside, resistances could be seen at 1.1000 (static level, round level), 1.1050 (static level) and 1.1100 (static level).
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.
(This story was corrected on April 8 at 09:12 GMT to mention in the first bullet point that EUR/USD stays below 1.1000, not 1.0000.)
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Author
Eren Sengezer
FXStreet
As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.
