The EUR/USD pair is experiencing slight upward movement, currently positioned at approximately 1.1655 during the early hours of the Asian trading session on Friday. The US and Iran have arrived at a preliminary accord; however, the agreement awaits the necessary approval from Trump. The annual US PCE rates aligned with forecasts; however, the monthly figures were weaker than anticipated. The EUR/USD pair records slight increases around 1.1655 in the early Asian session on Friday.
The Euro strengthens against the US Dollar after reports that the United States and Iran had reached an agreement to extend a ceasefire. The preliminary readings of Germany’s inflation are set to be released later on Friday. The US and Iran have come to a preliminary arrangement to facilitate access to the Strait of Hormuz and initiate discussions regarding nuclear matters, although US President Donald Trump has yet to endorse the agreement, as reported on Thursday. Iranian officials have yet to provide commentary on a prospective agreement.
Meanwhile, US Vice President JD Vance noted that “a couple of language points” remain under discussion, yet the parties are advancing in peace negotiations. Indicators of advancement in the US-Iran peace agreement may lend some support to higher-risk assets, including the shared currency, in the short term. While the annual US Personal Consumption Expenditures Price Index data aligned with expectations, the subdued monthly figures may offer some optimism that the surge in prices observed in the prior month has started to moderate.
This report indicated that the US Federal Reserve may maintain interest rates at their current levels for an extended period. The combination of core PCE, which came in a little bit softer, and the growth data also coming in a little softer sends a message that perhaps the Fed can be a little bit less aggressive with its higher-for-longer, which is somewhat risk-supportive,” stated Joel Kruger.