EUR/USD falls to around 1.1465 in the early Asian session on Thursday. The Federal Reserve kept its overnight lending rate unchanged during the March meeting on Wednesday. The anticipation is that the ECB will keep the key interest rates steady at their existing levels this Thursday.
The EUR/USD pair sees a drop, hovering around 1.1465 during the early Asian session on Thursday. The US Dollar demonstrates strength against the Euro following a hawkish stance from the US Federal Reserve. The attention will shift to the interest rate decision from the European Central Bank later on Thursday. The Federal Reserve decided to keep the interest rates steady at 3.5%–3.75% during its policy meeting in March on Wednesday.
The central bank suggests that a decrease might be expected in 2026. Fed Chair Jerome Powell mentioned, “The forecast is that we will be making progress on inflation, not as much as we had hoped, but some progress on inflation.” He observed that increasing oil prices due to the Iran conflict are expected to push inflation higher in the near future. Additionally, Powell mentioned that he will persist in his position as Fed chair until the inquiry regarding the central bank’s headquarters is finished and, regardless, will stay until his successor is officially designated.
The ECB is expected to keep its three main interest rates unchanged during the March meeting on Thursday. The financial markets have shifted focus from expecting further rate reductions. Market participants are currently anticipating two rate increases by the conclusion of 2026, driven by inflationary pressures, as reported.