Euro: September hike outlook offers support against US Dollar – UOB

FXStreet Insights Team FXStreet

UOB strategists highlight that EUR/USD slipped slightly to 1.1369 as comments from European Central Bank (ECB) Governing Council member Gediminas Simkus suggested a rate increase remains more likely than a hold. They also now expect one final 25 bps ECB hike in September to 2.50% on the deposit rate, followed by an extended pause, with risks skewed to further tightening if energy prices stay elevated.

Mild Euro pullback but hawkish ECB tilt

"The European Central Bank (ECB) left all three policy rates unchanged at its 23 Jul meeting, keeping the deposit rate at 2.25%."

"EUR/USD slipped 0.1% to 1.1369, as ECB Governing Council member Gediminas Simkus indicated that a rate increase remains more likely than a hold."

"We now expect one final 25 bps rate hike in Sep, taking the deposit rate to 2.50%, followed by an extended pause."

"However, additional tightening cannot be ruled out if elevated energy prices persist and lead to stronger second-round inflation effects."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

GBP/USD strengthens beyond mid-1.3300s vs weak USD amid fresh Iran diplomacy hopes

The GBP/USD pair builds on Friday's modest bounce from a three-week low and gains strong follow-through positive traction at the start of a new week. This marks the second straight day of a positive move and lifts spot prices above mid-1.3300s during the Asian session amid a broadly weaker US Dollar.

EUR/USD climbs beyond 1.1400 as renewed Iran diplomacy hopes undermine safe-haven USD

The EUR/USD pair builds on a modest bullish gap opening and climbs back above the 1.1400 mark during the Asian session on Monday. The intraday move up is sponsored by a broadly weaker US Dollar, weighed down by renewed optimism over a diplomatic resolution to end a five-month-old US-Iran war.

Gold buyers try their luck on Mideast respite, Oil slump

Gold is off the highs but holds its bullish opening gap, while struggling near $4,100 early Monday. Despite the recent rebound, buyers trade with caution, keeping a close eye on the Middle East developments ahead of the US Federal Reserve policy verdict this week.

Cardano: Under pressure as bearish derivatives cap recovery

Cardano remains under pressure, trading lower at $0.165 on Monday after mild losses in the previous week. Weakening derivatives metrics and subdued momentum indicators suggest that ADA's upside move remains limited, keeping downside risks in focus. Derivatives data for Cardano shows bearish sentiment among traders.

Australian Dollar outlook: Chances of another rally won’t be decided in Canberra, but in Washington

The Australian Dollar rode a rollercoaster in the first half of the year, hitting a four-year high and then correcting. The currency enters the second half with an outlook full of uncertainty due to renewed hostilities in the Middle East, which clouds the inflation outlook and interest rates.

US Dollar mid-year outlook: Exceptional currency, exceptional risks?

The US Dollar enters the second half of 2026 in a markedly different position from a year ago. The King currency has recovered, reflecting persistent US inflation, changing expectations for Fed policy, geopolitical tensions and renewed demand for defensive assets.