EURUSD will likely be the most volatile currency pair into the weekend with economic data from Germany and the US.
EURUSD – Weekly Chart
The price of the EURUSD exchange rate is hovering above the resistance at 1.1150. The next target to the upside would be at 1.1277. Investors could wait for confirmation on a breakout continuation, or a reversal bearish bar on the weekly chart.
Thursday evening has durable goods order from the United States, with a more important reading of jobless claims.
Federal Reserve officials maintain that the economy and labour market are in good shape, but the recent 50 basis point rate cut is maybe a sign of concern at recent weakness.
Germany also has labour market data this week with the release of the latest unemployment numbers and unemployment rate on Friday. The Swiss central bank was the latest to cut interest rates and a coordinated rate cut cycle is now in effect, including in China.
HSBC said on Wednesday that it expects the European Central Bank to cut interest rates by 25 basis points at every meeting from October through to April next year given weakening economic data. However, one policymaker said that rates will not head back to pre-pandemic lows near zero.
If HSBC are right it would take the key deposit rate to 2.25%. “At this point, policy should be close to neutral or even mildly stimulative. Previously we had expected cuts every other meeting until the key deposit rate hit 2.50% in September 2025,” analysts said.
Survey data released on Monday showed eurozone business activity as a whole contracted rapidly and unexpectedly this month as the dominant services sector stumbled, boosting expectations that the ECB could cut rates again soon.
The central bank delivered its second rate cut this year in September. Continued weakness in economic data could halt the recent rally in the euro. If economic weakness persists globally, we could see a return to the dollar as a safe haven.
