EUR/USD

Key insight

The pair pulled back sharply from the 2026 high of 1.1915 and is now consolidating near 1.1400 — the ECB at 2.40% vs. the Fed at 3.75% remains the dominant structural drag on the euro, and no catalyst has yet emerged to reverse this 475bp rate gap.

EUR/USD is range-bound between the 1.1400 key round support and the 1.1480 short-term resistance, unable to break either level as ECB/Fed policy divergence and Middle East geopolitical risk offset each other.

Main risk

ECB Rate Decision Outcome & Forward Guidance

If the ECB signals a pause or rate cut at its July meeting while the Fed holds at 3.75%, the 475bp US-EU rate differential widens further, pressuring EUR/USD toward the 1.1280 structural support.