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Source: Newsmaker.id
The euro held relatively steady around US$1.12 during Monday’s trading session (October 26), though it remains near its lowest level in recent months. Investors are now awaiting the European Central Bank’s (ECB) policy decision, alongside a series of upcoming data releases on inflation and economic growth in the Eurozone.
The ECB is expected to keep interest rates unchanged this week, amid signs of an economic slowdown. Market focus will shift toward the ECB’s policy guidance—specifically, whether the central bank leaves the door open for a potential rate hike in December.
Pressure on the euro also stems from France’s deteriorating fiscal position and mounting strain in the bond market. These factors are limiting the potential for the single European currency to strengthen, given the economic uncertainty across the region.
Regarding economic growth, Eurozone GDP data due on Friday is expected to show a slowdown. Factors such as the summer heatwave, low water levels on key transport waterways, and rising global bond yields have acted as headwinds for economic activity in the region.
Meanwhile, inflationary pressures appear mixed; fuel tax cuts in Germany and a cooling of inflation in Spain may help ease price pressures. In the U.S., the Federal Reserve is also expected to hold interest rates steady this week. Markets currently anticipate that both the ECB and the Fed might only consider rate hikes in December, making the policy direction of both central banks a critical factor for the EUR/USD pair. (srh)
Source: Newsmaker.id