The euro (EUR) appears to have bottomed below 1.1600 and is rising slightly on Wednesday amid growing speculation about a US-Iran deal and a hawkish outlook for the Federal Reserve (Fed) at its April monetary policy meeting. At the time of writing, the EUR/USD exchange rate is 1.1622, up 0.19%.
EUR/USD rises as pliable oil offsets hawkish Fed protocols
The mood improved after the news that the US would soon reach an agreement with Iran. US President Donald Trump said negotiations were in their final stages, but warned Iran that failure to reach an agreement would open the door to attacks on the Islamic Republic.
Oil prices fell on the news, extending losses by more than 5%, with US crude oil benchmark WTI trading at around $98.45 a barrel. The positive correlation between WTI and the US dollar has pushed the dollar lower, as shown by the US Dollar Index (DXY).
DXY, which measures the dollar’s value against six currencies, fell 0.19% to 99.11.
Recently, the Financial Times reported that “two China-bound supertankers have passed through the Strait of Hormuz.” This deepens speculation that opening the Strait of Hormuz could ease inflationary pressures, lowering energy prices and reducing the risk of a global stagflation scenario.
In the US, minutes from recent Fed meetings showed that most FOMC members adopted a hawkish stance, supporting some policy tightening if inflation remains above the 2% target.
The April meeting was the second in which more officials said it would be appropriate to raise borrowing costs if prices remain high. The minutes concluded that “participants who observed the conflict in the Middle East generally could have significant implications for the balance of threats and the appropriate policy path.”
Traders have priced in almost a 50% chance of an interest rate hike at the Fed’s December meeting.
The ECB expected an raise at its June meeting
On the other side of the ocean, the latest euro zone (EZ) inflation reading above the 3% threshold is further confirmation by several European Central Bank (ECB) policymakers that they must take action at its June meeting.
At the April meeting, the ECB debated raising interest rates, signaling that the meeting scheduled for June 11 may be the first to raise the ECB Deposit Rate.
Prime Terminal data showed an almost 82% chance that the ECB would raise rates by 25 basis points.
On Tuesday, the ECB’s Kocher said a June interest rate hike was still possible if “there is no improvement in the war in Iran.” The Bundesbank’s Joachim Nagel agreed with this view, saying the ECB was moving away from its baseline and that “we may have to act in June.”
Francois Villeroy of Banque de France said the central bank “will be ready to act if necessary” and that the conflict in Iran created risks to economic growth and inflation.
EUR/USD Price Forecast: Technical Outlook
On the daily chart, the EUR/USD rate is 1.1623. In the brief term, the pair is showing a slightly bearish bias, holding below the latest triple plain moving average around 1.1649, keeping the price below the key energetic barrier. The broader structure continues to include a bearish resistance trendline projected from 1.1929, while the Relative Strength Index (14) near 42 suggests the upside momentum is fading rather than completely oversold.
On the other hand, initial resistance is seen at the triple plain moving average near 1.1649, with the downtrend line from 1.1929 strengthening a higher upper limit if buyers try to rebound. On the other hand, support first appears around the former uptrend line break area near 1.1578, before a more structural uptrend start around 1.1411, where more buying interest can be expected if the correction deepens.
(The technical analysis for this story was written with the assist of an AI tool.)
Price in euros this week
The table below shows the percentage change of the euro (EUR) against the major currencies traded this week. The euro was strongest against the Japanese yen.
| USD | EUR | GBP | JPY | BOOR | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.03% | -0.84% | 0.08% | -0.07% | 0.01% | -0.31% | 0.05% | |
| EUR | 0.03% | -0.82% | 0.17% | -0.05% | 0.03% | -0.21% | 0.05% | |
| GBP | 0.84% | 0.82% | 0.94% | 0.77% | 0.86% | 0.62% | 0.86% | |
| JPY | -0.08% | -0.17% | -0.94% | -0.22% | -0.14% | -0.41% | -0.10% | |
| BOOR | 0.07% | 0.05% | -0.77% | 0.22% | 0.01% | -0.20% | 0.08% | |
| AUD | -0.01% | -0.03% | -0.86% | 0.14% | -0.01% | -0.24% | 0.11% | |
| NZD | 0.31% | 0.21% | -0.62% | 0.41% | 0.20% | 0.24% | 0.24% | |
| CHF | -0.05% | -0.05% | -0.86% | 0.10% | -0.08% | -0.11% | -0.24% |
The heat map shows the percentage changes of the major currencies relative to each other. The base currency is selected from the left column and the quote currency from the top row. For example, if you select Euro from the left column and move along the horizontal line to US Dollar, the percentage change displayed in the box will represent EUR (base)/USD (quote).
