EUR/USD
BearishArchived analysis from Jul 24, 2026, 5:21 AM
Key insight
The ECB held rates at 2.40% yesterday (23 July) while signalling a possible September hike — but with the Fed anchored at 3.75% and Fed Chair Warsh declaring inflation still "too high," the 135bp rate differential keeps structural pressure on EUR/USD; today's Eurozone Flash PMI is the next make-or-break catalyst.
EUR/USD has pulled back sharply from the 2026 high of 1.1915 and now trades below the EMA65 and EMA200 at ~1.1434, with Bank of America targeting 1.12 by end-Q3 amid a 150bp Fed-ECB rate differential favouring the dollar.
Main risk
Trump Permanent Tariff Reimposition
The Trump administration is expected imminently to introduce permanent new tariffs replacing temporary ones struck down by the Supreme Court, which would reignite dollar safe-haven demand and knock EUR/USD back toward the 1.1280 support.
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