Euro: Strong GDP supports September ECB hike – BBH

FXStreet Insights Team FXStreet

Brown Brothers Harriman’s (BBH) Elias Haddad reports EUR/USD is consolidating after a rally driven by stronger-than-expected Eurozone Q2 GDP at 0.4% quarter-on-quarter. The recovery in Eurozone activity and above-target inflation reinforce expectations for a European Central Bank (ECB) rate hike in September, though Haddad notes existing market pricing limits Euro (EUR) upside.

Eurozone data backs ECB tightening

"EUR/USD is consolidating yesterday’s rally. Eurozone Q2 real GDP growth was double expectations at 0.4% q/q vs. 0.0% in Q1 with gains broad-based across the major economies."

"The ECB projects real GDP growth to average 0.8% in 2026 with risk skewed to the downside as renewed disruption of energy supplies would weigh on real incomes, spending, and investment."

"Bottom line, the recovery in Eurozone economic activity and above target inflation reinforces the case for the ECB to resume raising rates in September."

"That’s unlikely to offer EUR much upside traction as the swaps curve already implies nearly 90% odds of a 25bps rate hike at the September 10 meeting."

(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 retreats from 1.3400 after BoE decision, ahead of US GDP

GBP/USD retreated after peaking a handful of pips above the 1.3400 mark, following the BoE's announcement. The Bank of England decided to maintain the benchmark rate unchanged at 3.75%. The MPC voted 6-3 in favor of keeping rates on hold, with the 3 dissenters favoring a rate hike. US Q2 GDP coming up next.

EUR/USD neutral around 1.1460 as US Q2 GDP looms

EUR/USD trimmed early losses and trades flat for the day early in the American session on Thursday, helped by better-than-expected German and Eurozone GDP data and renewed US Dollar weakness. Traders now brace for preliminary readings on US second-quarter GDP.

Gold stable below $4,100 as USD resumes decline

Gold hovers around its daily open ahead of the U.S. open on Thursday, trimming early losses. The Greenback enjoyed some near-term demand following Wednesday's post-FOMC downfall, but was unable to retain its gains. Market players now waiting for US Q2 GDP.

BoE Press Conference: Governor Bailey comments on policy outlook after July hold

Bank of England (BoE) Governor Andrew Bailey explains the decision to maintain the bank rate at 3.75% in a 6-3 vote split following the July monetary policy meeting and responds to questions from the press. Follow here the press conference.

US GDP expected to grow at 2.1% in Q2, unshaken by Iran conflict

The United States (US) Bureau of Economic Analysis (BEA) is set to publish its preliminary estimate of second-quarter Gross Domestic Product (GDP) on Thursday, with analysts expecting the data to show annualised growth at a solid 2.1%, a modest cooling from the 2.1% expansion recorded in the previous quarter.

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.