EUR/USD holds steady around the 1.1600 level, recording slight gains of more than 0.15% on Monday as the Greenback declines in response to hawkish comments from Kazuo Ueda, the Governor of the Bank of Japan. The limited economic agenda on both sides of the Atlantic enhanced the Euro’s outlook. The Euro experiences a slight increase as the USD declines, influenced by shifts in risk stemming from the Bank of Japan, alongside speculation regarding future leadership at the Federal Reserve.
The EUR/USD pair has increased by 0.15%, approaching the 1.1600 level, as the Dollar experiences a decline in strength following the hawkish remarks made by BoJ’s Ueda. The US ISM Manufacturing sector experiences another contraction, with companies reporting layoffs associated with Trump’s tariffs. The Euro’s sentiment is bolstered by a combination of mixed Eurozone PMIs and optimism regarding advancements in the Ukraine–Russia peace negotiations.
> The US schedule included the Purchasing Managers’ Indices for November, indicating a slowdown in manufacturing activity : Comments indicated that manufacturers within the transportation equipment sector attributed layoffs to the tariffs imposed by Trump. In addition to this, the Dollar continued to decline as speculation grows regarding the potential succession of Fed Chair Jerome Powell by White House National Economic Advisor Kevin Hassett, following the conclusion of Powell’s term in May 2026. In Europe, the HCOB Manufacturing PMIs were published for the region, with Germany and the Eurozone not meeting expectations. France met expectations, whereas Spain and Italy exceeded them. The data had minimal impact on the EUR/USD, which may be supported by a favorable outcome in the Ukraine-Russia conflict. This week, the EU economic calendar will include the Harmonized Index of Consumer Prices. The upcoming schedule in the US includes the ADP Employment Change, ISM Services PMI, Initial Jobless Claims, and the Core PCE, which is the Fed’s preferred measure of inflation.
Latest FX Rate Trends : EUR/USD remains solidly above 1.1600
- On Monday, BoJ Governor Ueda stated, “The BOJ is at the stage where it should examine whether firms’ active wage-setting behavior will continue.” He stated that “We will examine and discuss economic and price developments at home and abroad, as well as market moves … and consider the pros and cons of raising interest rates.”
- The ISM Manufacturing PMI decreased from 48.7 in October to 48.2 in the previous month. The sub-component of employment decreased from 46 to 44, whereas Prices Paid increased to 58.5 from 58, falling short of the anticipated 59.5.
- Expectations for a rate cut by the Fed continue to be robust, as per reports, which indicates an 87.4% probability of a 25-basis points reduction in December, an increase from 86% observed last Friday.
- The HCOB Flash Manufacturing PMIs for Germany decreased to 48.2 in November, down from 49.6 in October. The decline was primarily attributed to a significant decrease in new orders, with exports experiencing the steepest decline due to diminished demand from Asia, Europe, and North America.
- Martin Kocher stated that the ECB should maintain its current stance on interest rates. He remarked, “I believe slight deviations above or below the 2% target should not yet trigger any need to act now, because we cannot and do not want to engage in that kind of micro-management of monetary policy.”