EUR/USD remains stable above the 1.1700 level on Monday as the US Dollar shows signs of weakness, with market participants anticipating the upcoming Nonfarm Payrolls report on Tuesday. As of the current moment, the pair is trading at 1.1739, remaining stable.
EUR/USD is currently positioned at 1.1739 as the Dollar experiences a decline, with the DXY recording its third loss in four trading sessions. Ongoing mixed commentary from the Fed is evident, with Miran adopting a dovish stance, Collins maintaining a neutral position, and Williams indicating that policy is approaching neutrality. Market participants are closely monitoring the forthcoming US Non-Farm Payrolls and Retail Sales reports, which are critical drivers for the Dollar and expectations surrounding Federal Reserve policy.
> The Euro stabilizes close to multi-week peaks as market participants anticipate Nonfarm Payrolls and evaluate conflicting statements from the Fed : The greenback is showing a slight decline, down 0.10% as indicated by the US Dollar Index. The DXY, monitoring the dollar’s performance against a group of six currencies, experiences its third daily decline in four days, potentially heading towards the 98.00 mark if the employment sector continues to weaken. The US docket included a series of Federal Reserve officials. Fed Governor Stephen Mira expressed a dovish stance, while Boston Fed President Susan Collins defended her decision from the December meeting, delivering neutral remarks. In contrast, New York Fed President John Williams expressed a somewhat hawkish stance, indicating that policy has transitioned “from modestly restrictive” to neutral. On Tuesday, market participants will analyze the November Nonfarm Payrolls and Retail Sales, along with additional remarks from Federal Reserve speakers. A recent poll indicates that economists anticipate the European Central Bank will maintain its current stance through 2026, as they forecast inflation to remain low, while the economy is expected to demonstrate resilience. As we approach the week, the expectation is that the ECB will maintain current rates during the meeting on December 18.
Latest FX Rate Trends : EUR/USD remains stable amid Fed’s hawkish commentary
- Last week, the Federal Reserve implemented its third interest rate cut of 2025, adjusting the target range to 3.50%–3.75% following a split decision. Fed Chair Jerome Powell indicated that policymakers might consider pausing the easing cycle as the economy adjusts to the total 75 basis points of rate cuts implemented this year.
- Boston Fed President Susan Collins indicated that she perceives inflation risks to be diminished compared to previous assessments, supporting the recent rate cut in light of a changing risk landscape.
- New York Fed President John Williams emphasized the importance of bringing inflation back to the 2% target, highlighting that companies seem hesitant to make decisions regarding hiring and layoffs. Williams anticipates that the unemployment rate will remain around 4.5% by the end of the year and projects inflation to meet the target by 2027. He anticipates GDP growth of 2.25% in 2026, which exceeds the projected rate for 2025.
- Previously, Fed Governor Stephen Miran expressed a notably dovish perspective, suggesting that an accelerated rate-cutting approach would align policy more closely with neutral levels. He emphasized the anticipation for a more rapid decrease in shelter inflation as reflected in the PCE index and minimized the impact of tariffs on the increase in goods inflation.
- In November, the US Nonfarm Payrolls are projected to reflect an increase of 40K jobs, while the Unemployment Rate is anticipated to remain stable at 4.4%. October Retail Sales are anticipated to increase by 0.2% month-over-month, remaining consistent with September’s figures. Meanwhile, control-group sales, which are utilized in GDP calculations, are expected to recover to 0.3% following a prior contraction of 0.1%.