EUR/USD steadied during Friday’s North American session and was set to end the week and November in positive territory with gains of 0.81% and 0.59% respectively as traders appear confident that Federal Reserve System will cut rates in December. The pair is trading at 1.1601 after bouncing off the daily lows of 1.1555.
Euro ends week and month higher as dovish Fed signals outweigh mixed US data
The US dollar is treading water amid growing speculation of a rate cut. Data from the CME FedWatch Tool put the odds of a 25 basis point cut in the Fed funds rate at the December meeting at 87%. The revaluation was triggered by dovish comments from New York Fed John Williams and Fed Governor Christopher Waller, who favored cutting borrowing costs at the December meeting.
The data was mixed during the week. Producer-side inflation stabilized, while jobs data released by the U.S. Labor Department showed the number of Americans filing for unemployment benefits fell compared to the previous print.
On the other hand, retail sales in Germany missed October estimates, while the harmonized index of consumer prices (HICP) for November beat forecasts and came close to the 3% mark. In France, Q3 gross domestic product (GDP) was in line with estimates and preliminary data, while Spain’s HICP breached the 3% mark.
Given this situation, EUR/USD’s path of least resistance is tilted to the upside as the European Central Bank (ECB) has indicated that the easing cycle is over, while the Fed is expected to taper in December.
Next week’s US economic calendar will be packed with November ISM PMIs for manufacturing and services, industrial production, ADP Employment Change report and Initial Unemployment claims for the week ending November 29.
Price in euros this month
The table below shows the percentage change of the Euro (EUR) against the major listed currencies for the month. The euro was strongest against the Japanese yen.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.31% | -0.69% | 1.38% | -0.09% | 0.10% | 0.07% | 0.17% | |
| EUR | 0.31% | -0.39% | 1.63% | 0.22% | 0.39% | 0.38% | 0.48% | |
| GBP | 0.69% | 0.39% | 2.03% | 0.61% | 0.76% | 0.77% | 0.87% | |
| JPY | -1.38% | -1.63% | -2.03% | -1.44% | -1.24% | -1.26% | -1.19% | |
| CAD | 0.09% | -0.22% | -0.61% | 1.44% | 0.12% | 0.16% | 0.26% | |
| AUD | -0.10% | -0.39% | -0.76% | 1.24% | -0.12% | -0.00% | 0.11% | |
| NZD | -0.07% | -0.38% | -0.77% | 1.26% | -0.16% | 0.00% | 0.09% | |
| CHF | -0.17% | -0.48% | -0.87% | 1.19% | -0.26% | -0.11% | -0.09% |
The heat map shows the percentage changes of major currencies against each other. The base currency is selected from the left column, while the quote currency is selected from the top row. For example, if you select Euro from the left column and move along the horizontal line to the US Dollar, the percentage change shown in the box will be EUR (base)/USD (rate).
Daily Market Moves: Euro set to extend gains as dollar weakens
- The shared currency is driven by a weak US dollar as shown by the US Dollar Index (DXY). The DXY, which tracks the dollar against a basket of six peers, was down 0.08% at 99.44.
- Germany’s annual HICP rate rose 2.6% above estimates of 2.4% from 2.3% in September. Other data in France, Q3 2025 GDP rose 0.1% quarter-on-quarter versus forecasts and 0% in Q2.
- Finally, Spain’s HICP rose 3.1% year-on-year in November, down from 3.2% a month ago but beating forecasts of 2.9%.
Technical outlook: EUR/USD subdued around 1.1600, catalyst awaited
EUR/USD continues to trade sideways, with buyers unable to decisively break above 1.1600 to extend the advance towards the confluence of the 50- and 100-day simple moving averages (SMA) at 1.1620/1.1643. Momentum remains slightly positive as reflected in the Relative Strength Index (RSI), although the indicator has flattened, suggesting consolidation is likely to continue in the near term.
A clear break above the 50-/100-day SMA cluster would reveal 1.1650, and once cleared, would open the way for a test of the 1.1700 handle.
on the other hand, euro a fall below 1.1550 increases the risk of a slide towards 1.1500. Further weakness would reveal the November 5 swing low at 1.1468, followed by the 200-day SMA near 1.1431.
Euro frequently asked questions
The euro is the currency of the 20 countries of the European Union that belong to the eurozone. It is the second most traded currency in the world after the US dollar. In 2022, it accounted for 31% of all foreign exchange transactions with an average daily turnover of over $2.2 trillion per day. EUR/USD is the most traded currency pair in the world and represents an estimated 30% discount on all trades, followed by EUR/JPY (4%), EUR/GBP (3%) and EUR/AUD (2%).
The European Central Bank (ECB) in Frankfurt, Germany is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy. The ECB’s primary mandate is to maintain price stability, which means either controlling inflation or stimulating growth. Its primary tool is raising or lowering interest rates. Relatively high interest rates – or expectations of higher rates – usually benefit the euro and vice versa. The Governing Council of the ECB takes decisions on monetary policy at meetings held eight times a year. Decisions are made by the heads of the national banks of the eurozone and six permanent members, including ECB President Christine Lagarde.
Eurozone inflation data, as measured by the Harmonized Index of Consumer Prices (HICP), is an important econometric indicator for the euro. If inflation rises more than expected, especially if it is above the ECB’s 2% target, it obligates the ECB to raise interest rates to bring it back under control. Relatively high interest rates compared to its peers will usually benefit the euro, making the region more attractive as a place for global investors to park their money.
The published data assesses the health of the economy and may have an impact on the euro. Indicators such as GDP, manufacturing and services PMIs, employment and consumer sentiment surveys can all influence the direction of the single currency. A strong economy is good for the euro. Not only will this attract more foreign investment, but it may encourage the ECB to raise interest rates, which will directly strengthen the euro. Otherwise, if the economic data is weak, the euro is likely to fall. Economic data for the four largest economies in the euro area (Germany, France, Italy and Spain) are particularly significant as they account for 75% of the euro area economy.
Another important data release for the euro is the trade balance. This indicator measures the difference between what a country earns on exports and what it spends on imports for a given period. If a country produces a highly sought-after export, then its currency will gain in value purely due to the extraordinary demand created by foreign buyers who want to buy those goods. Therefore, a positive net trade balance strengthens the currency and vice versa a negative balance.
