EUR/USD cycles 1.10 after Powell pushes back on rate cut bets

EUR/USD is looking for a foothold at the 1.1000 region.
Fed Chair Powell threw cold water on rising rate cut hopes.
US tariffs increase odds of recession and inflationary spark, crimping Fed options.

Joshua Gibson FXStreet

EUR/USD churned near 1.1000 on Friday, sticking mostly flat as exhausted markets were greeted by an overly-cautious Federal Reserve (Fed) Chair Powell, who warned that inflation and recession risks thanks to tariffs will make it less, not more, likely that the Fed will cut rates sooner.

Later rather than sooner

Fed Chair Powell noted that alongside Friday’s US Nonfarm Payrolls (NFP) report, the US economy looks healthy overall. However, the impending inflationary impacts from US President Donald Trump’s tariffs this week cannot be ignored. While Fed officials have put significant effort into not saying it directly, stagflationary risks are on the rise thanks to the Trump administration.

More to come…

Author

Joshua Gibson

FXStreet

Joshua joins the FXStreet team as an Economics and Finance double major from Vancouver Island University with twelve years' experience as an independent trader focusing on technical analysis.

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