Euro holds near YTD low against USD with US macro data and ECB policy update still in focus

  • After rebounding from a 17-month low following the FOMC decision the previous day, EUR/USD faces renewed selling.
  • France’s debt crisis puts pressure on the Euro as geopolitical risks and a hawkish Fed support the USD.
  • Key US economic releases and the pivotal ECB decision are the next potential catalysts for traders.

With important US economic figures and a key central bank decision still to come, EUR/USD is trading below 1.1150, near its lowest point since May 2025. The pair retains a modest downward bias during the first half of Thursday’s European session, although traders’ caution ahead of these events is helping to limit losses.

TMGM Analysis: Financial Market News, Economic Calendar & Market Insights

Due later today, the advance US Q3 GDP estimate and the US Personal Consumption Expenditures (PCE) Price Index should offer further guidance on the Federal Reserve’s (Fed) policy trajectory. Their implications for the US Dollar (USD) will, in turn, give EUR/USD fresh direction. Focus will subsequently turn to the much-awaited European Central Bank (ECB) decision.

Market expectations point to unchanged ECB interest rates, alongside a continued hawkish bias towards a possible 25-basis-point (bps) increase in December. Close attention will also be paid to the accompanying policy statement and remarks from ECB President Christine Lagarde. These could generate volatility in the single currency and create further short-term trading opportunities in EUR/USD.

Pressure on the single currency persists as concerns grow over France’s mounting debt and political deadlock ahead of next year’s election. By contrast, hawkish Fed expectations and geopolitical uncertainty are helping the USD regain ground after the previous day’s corrective retreat from a two-week high. Together, these factors leave EUR/USD under pressure and support the case for additional losses.

At the conclusion of its October policy meeting, the Fed voted 10-2 to leave interest rates unchanged, as widely anticipated. Governor Lisa Cook and Cleveland Fed President Beth Hammack favoured a quarter-point increase. In the subsequent press conference, Fed Chair Kevin Warsh also indicated that the central bank remained alert to persistent inflation risks arising from the Middle East conflict.

Alongside worries about energy-led price pressures, that message reinforces the prospect of additional Fed tightening. Traders assign around an 80% probability to a rise in borrowing costs at the US central bank’s December policy meeting, according to the CME Group’s FedWatch Tool. Such a hawkish outlook supports USD bulls and reinforces the negative near-term view of EUR/USD.

EUR/USD on the 4-hour chart

Chart Analysis EUR/USD

Technical Outlook Remains Bearish

Trading beneath the 100-period Exponential Moving Average (EMA) at 1.1216 on the 4-hour chart leaves EUR/USD with a bearish near-term bias. Before positioning for a continuation of the established downtrend seen over the past two months or so, however, sellers might wait for a break beneath the 1.1115-1.1110 zone.

The intraday swing high around 1.1160 may offer traders clues as to whether a base is forming or the bearish sequence is continuing. Beyond that, any recovery could encounter resistance around 1.1200, ahead of the 100-period EMA at 1.1215. Only a sustained move above this level would relieve the prevailing downward pressure.

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

Economic Data Release

Core Personal Consumption Expenditures - Price Index (YoY)

Published monthly by the US Bureau of Economic Analysis, the Core Personal Consumption Expenditures (PCE) measure tracks changes in the prices of goods and services bought by consumers in the United States (US). The Federal Reserve (Fed) also uses the PCE Price Index as its preferred inflation gauge. For the year-on-year (YoY) figure, goods prices in the reporting month are compared with those in the corresponding month a year earlier. By excluding the more volatile food and energy components, the core measure aims to provide a more accurate assessment of underlying price pressures. A high reading is generally positive for the US Dollar (USD), whereas a low reading is generally negative.

Find out more.

Next publication: Thu 29 Oct 2026 12:30

Publication frequency: Monthly

Consensus forecast: 3.1%

Prior reading: 3%

Data source: US Bureau of Economic Analysis

The Personal Consumption Expenditures (PCE) Price Index is published by the US Bureau of Economic Analysis following its GDP report, together with monthly changes in Personal Spending and Personal Income. For FOMC policymakers, the annual Core PCE Price Index is the principal measure of inflation, excluding volatile food and energy prices. If the reading exceeds expectations, the USD could outperform other currencies, as the data would suggest a possible hawkish turn in the Fed’s forward guidance. A weaker-than-expected result could have the opposite effect.