The US dollar has continued its bullish momentum, driven by the Federal Reserve’s resilient stance and consistently strong labor market performance. Recent data indicating robust job growth and expectations of prolonged higher interest rates have supported the greenback, pushing the EUR/USD pair downward. Investors now anticipate that the Fed will maintain tight monetary policy longer than previously expected, contrasting with the European Central Bank’s dovish outlook. These diverging policy paths have intensified downward pressure on the euro.
The EUR/USD pair has been trading under increased bearish sentiment, with the euro unable to find support amid weaker economic data from the Eurozone. Sluggish growth and subdued inflation figures have added to speculation that the ECB may implement rate cuts sooner than the Fed, further widening interest rate differentials. As a result, traders are increasingly favoring the dollar, reinforcing its dominance in the currency markets and keeping EUR/USD near recent lows.
Read more on EUR/USD trading.