The EUR/USD exchange rate slid as the Federal Reserve reaffirmed a cautious approach to monetary easing, signaling a slower pace than markets anticipated. This hawkish tone from the Fed dampened investor sentiment and boosted demand for the dollar, pushing the euro lower in trading. Market participants were quick to react as Fed officials highlighted persistent inflation concerns, emphasizing their commitment to keeping rates elevated until inflation shows sustained signs of moderation.
Source – FXStreet
The euro’s decline comes as European Central Bank policymakers maintain a more dovish tone, focusing on economic stabilization. This divergence in policy outlooks between the Fed and ECB further weighed on the euro, intensifying bearish momentum. Analysts predict that the EUR/USD could face additional downward pressure if U.S. economic data continues to support the Fed’s restrictive stance, leaving traders bracing for increased volatility in the weeks ahead.
