EUR/USD markets are lethargic, as they continue to hold below the 1.0800 level in Wednesday morning European trading. The euro vs dollar currency pair is in heavy selling mode. Renewed demand for the US Dollar comes as a response to this morning’s new tariff threats from President Trump. The European Central Banks (ECB) recent dovish commentary piles on the pressure to the pair. This comes as it walks a tightrope leading up to high-impact US economic data releases and Federal Reserve discussions.
EUR/USD has been remarkably resilient all things considered. It is sitting pretty above the $3,000 psychological level for the second day in a row on Wednesday, keeping the positive bias intact. As the most favored currency pair on the Forex market, EUR/USD is among the most heavily traded currencies. Banks, financial institutions, and individual investors all recognize this rapidly-changing market. Traders love it, as it is incredibly liquid and volatile. This exceedingly important commodity is one of the best reflections we have about the overall health of the global economy.
Similar to many other currency pairs, the Euro USD pair price action is most affected by economic data releases or significant fundamental events in the US and Europe. Traders and economists are awaiting the important Core Personal Consumption Expenditures (PCE) report later this week. This data serves as the Federal Reserve’s favored measure of inflation. EUR/USD’s price action encapsulates the current global macroeconomic environment and the most impactful prevailing events. It is strongly affected by monetary policy choices at the ECB and the Fed.
Additionally, the EUR/USD pair continues to lack follow-through momentum and remains capped below the overnight swing high. That huge ongoing fluctuation also speaks to how sensitive the market really is—to everything from new geopolitical developments to subtle shifts in central bank communication.