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Euro climbs as Hormuz tensions eclipse hot US jobs report

  • US NFP beat estimates, but the Dollar remains under pressure.
  • Record-low consumer sentiment highlights growing US economic anxiety.
  • German industrial weakness fails to derail the Euro’s weekly advance.

EUR/USD edges higher during the North American session on Friday amid heightened tensions in the Middle East, even though a solid US jobs report might prevent the Federal Reserve (Fed) from cutting rates in the upcoming months. At the time of writing, the pair trades at 1.1775, up 0.44%.

Euro gains as geopolitical fears outweigh upbeat US payrolls

Tensions around the US-Iran conflict heightened as they exchanged strikes for control of the Strait of Hormuz. In the meantime, US Secretary of State Marco Rubio said they’re waiting for Tehran’s response to the 14-point memorandum, aimed at extending the ceasefire and reopening the Strait.

In the US, Nonfarm Payrolls for April crushed estimates of 62K jobs added to the economy, increased by 115K, while March’s print was upwardly revised to 185K. The Unemployment Rate remained steady at 4.3%, below the Fed’s 4.5% projected for the whole year, while Average Hourly Earnings rose by 3.6% beneath forecasts of 3.8%.

Although the data is positive, the Greenback failed to recover, weighed down by the Middle East conflict and also by consumers turning pessimistic about the economy, as revealed by the University of Michigan Consumer Sentiment.

The preliminary UoM Consumer Sentiment Index slid to a record low in May, falling to an all-time low of 48.2, down from April’s 49.8.

Comments of Joane Hsu, the Director of the Surveys of Consumers, show households complaining about “soaring prices at the pump,” as the developments in the Middle East are unlikely to meaningfully boost sentiment until supply disruptions have been fully resolved and energy prices fall.

Digging into the report, inflation expectations over the next year dipped from 4.7% to 4.5%. For the next five years, it dropped from 3.5% to 3.4%.

Meanwhile, the Euro (EUR) seems poised to end the week with gains of over 0.44%, even though Industrial Production in Germany plunged 0.7% in March, missing estimates and worse than the previous month's.

EUR/USD Price Forecast: Technical Outlook

Chart Analysis EUR/USD
EUR/USD daily chart

In the daily chart, EUR/USD trades at 1.1772, extending its recovery above the clustered simple moving averages around 1.1640 and staying well bid over the rising support trend line anchored near 1.1411. This positioning above both dynamic and structural floors suggests a bullish near-term bias, while the Relative Strength Index (14) hovering around 58 keeps positive but not overbought momentum in place, hinting that buyers still retain control as long as the pair holds above these underlying levels.

On the downside, immediate support is reinforced by the latest close at 1.1772, ahead of the triple simple moving average region near 1.1640, with the broader uptrend protected by the ascending trend line starting from 1.1411. On the topside, the next notable hurdle is the broader descending resistance trend line projected from the 1.1929 area, and a sustained break over that barrier would likely open the path for an extension of the current advance.

(The technical analysis of this story was written with the help of an AI tool.)

(This story was corrected on May 8 at 16:01 GMT to say that March’s NFP print was upwardly revised to 185K instead of downwardly revised to 178K.)

Euro Price This week

The table below shows the percentage change of Euro (EUR) against listed major currencies this week. Euro was the strongest against the Canadian Dollar.

USDEURGBPJPYCADAUDNZDCHF
USD-0.19%-0.19%-0.03%0.75%-0.40%-0.98%-0.35%
EUR0.19%-0.01%0.11%0.94%-0.15%-0.79%-0.11%
GBP0.19%0.00%0.13%0.95%-0.14%-0.78%-0.12%
JPY0.03%-0.11%-0.13%0.85%-0.31%-0.85%-0.31%
CAD-0.75%-0.94%-0.95%-0.85%-1.11%-1.69%-1.06%
AUD0.40%0.15%0.14%0.31%1.11%-0.64%0.02%
NZD0.98%0.79%0.78%0.85%1.69%0.64%0.67%
CHF0.35%0.11%0.12%0.31%1.06%-0.02%-0.67%

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).

Author

Christian Borjon Valencia

Markets analyst, news editor, and trading instructor with over 14 years of experience across FX, commodities, US equity indices, and global macro markets.

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