Title: In-depth EUR/USD Forecast: Currency Pair of the Week – November 3, 2025
Originally authored by Matt Weller, FOREX.com
The EUR/USD currency pair is one of the most closely watched in the world, given its significance in global trade, finance, and monetary policy. As we approach the first week of November 2025, several economic indicators, geopolitical changes, and policy expectations define the path forward for the euro against the U.S. dollar. This article provides a comprehensive outlook on the currency pair, incorporating both fundamental and technical factors.
Macroeconomic Context Driving EUR/USD Trends
The trajectory of the EUR/USD currency pair is deeply influenced by the broader macroeconomic environment in both the Eurozone and the United States. Presently, the economic dynamics display notable divergence.
United States Economic Landscape
– The U.S. economy has remained relatively resilient in 2025, supported by measured growth in consumer spending and robust labor market data.
– The Federal Reserve has maintained a cautious stance with interest rates, choosing to keep rates elevated while closely monitoring inflationary pressures.
– Inflation, although easing somewhat, remains sticky in certain sectors, especially services and housing.
– Economic data from Q3 showed a modest uptick in GDP, reinforcing the sentiment that rate cuts may be delayed until later in 2026.
Eurozone Economic Conditions
– The Eurozone faces slower growth, largely driven by weak manufacturing data, consumer caution, and geopolitical uncertainties.
– Germany, the region’s industrial engine, has experienced stagnant economic activity.
– ECB policy remains accommodative but cautious, balancing inflation control with the need to support fragile growth.
– Unlike the U.S., Eurozone inflation has declined more sharply, potentially opening the door for interest rate cuts sooner than in America.
Key Influencing Factors for EUR/USD this Week
1. Diverging Central Bank Policies
– The Federal Reserve has shown a preference for data-driven decisions and is holding its benchmark rate at the current level in the short term.
– The European Central Bank may be in a position to begin loosening monetary policy earlier than the Fed.
– This policy divergence is likely to favor the U.S. dollar in the near term, as higher U.S. interest rates attract more investors to dollar assets.
2. Inflation Indicators
– U.S. Personal Consumption Expenditures (PCE) index and Consumer Price Index (CPI) remain important data points for assessing inflation dynamics.
– Eurozone inflation data shows a cooling trend, with headline inflation falling toward the ECB’s 2 percent target.
– Core inflation, however, remains slightly elevated, which may delay aggressive rate cuts from the ECB.
3. Growth Expectations
– Economic projections show U.S. GDP expanding modestly while the Eurozone stagnates.
– Productivity improvements are supporting American economic output relative to Europe.
– Weaker consumer confidence in the Eurozone, coupled with energy-related concerns heading into winter, adds further downside risk to the euro.
4. Geopolitical Developments
– Ongoing geopolitical tensions in Eastern Europe and the Middle East pose headline risks that could lead to increased demand for safe-haven currencies like the U.S. dollar.
– The euro remains exposed to energy price volatility due to its dependence on imported natural gas and oil.
5. Technical Factors
Technical analysis offers another layer of insight. A review of key chart setups can help identify price targets and potential turning points for EUR/USD traders.
Technical Overview of EUR/USD
The currency pair has showcased significant volatility over the past several sessions, with traders navigating between a historically strong dollar and a stabilizing euro. From a charting perspective, here are key technical indicators:
Weekly Chart Insights
– The EUR/USD continues to trade below the 200-week simple moving average (SMA), a long-term downtrend signal.
– A series of lower highs have formed, consistent with a bearish pattern.
– Resistance at 1.0700 has proven difficult for bulls to breach, with repeated re
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