EUR/USD Hovers Near 1.1476 as Fed Holds Rates and Dollar Strength Persists

EUR/USD Steady at 1.1476 as Fed Holds Rates, Dollar Supported by Geopolitical Factors

The EUR/USD pair remained flat on Thursday morning, trading near 1.1476, after briefly climbing above the 1.1500 psychological level in response to the Federal Reserve’s decision to leave interest rates unchanged and the broader strength in the US Dollar (USD).

Fed Keeps Rates Unchanged, Eyes Higher Inflation and Slower Growth

The Federal Reserve maintained its benchmark interest rate at 4.25%–4.50%, citing stable economic conditions and a resilient labor market. However, newly released projections revealed a downward revision to GDP growth, marginal changes in unemployment expectations, and an upward adjustment to inflation forecasts.

Key takeaways from the June FOMC meeting:

• GDP growth revised lower
• Inflation now expected to remain above 3% through 2025
• Unemployment Rate unchanged at 4.5%
• The Fed will continue balance sheet reduction and maintain a cautious stance on monetary policy

📊 Explore the June 2025 Fed Outlook

Trump’s Iran Comments Boost USD Safe-Haven Appeal

Former President Donald Trump signaled openness to meeting with Iranian leadership, adding a diplomatic twist to rising Middle East tensions. These remarks helped bolster demand for the USD as a safe-haven currency, limiting the Euro’s post-Fed gains.

💬 Read More: Trump’s Foreign Policy Impact on USD

ECB Commentary Undermines Euro

Meanwhile, the European Central Bank (ECB) hinted at continued weakness in the Eurozone economy, as policymakers expressed caution over recovery momentum. This contrast between the relatively resilient US economy and a fragile Eurozone continues to weigh on the EUR/USD pair.

🧠 Learn: How ECB Policy Affects EUR/USD

Technical Outlook for EUR/USD

Despite briefly breaching 1.1500, EUR/USD remains capped below resistance amid strong USD demand. Immediate support lies at 1.1445, with resistance now seen at 1.1520. Market participants await further macroeconomic signals before confirming trend direction.

📈 Check our Live EUR/USD Chart and Analysis

Conclusion

The EUR/USD pair reflects a tug-of-war between dovish Fed projections and persistent US Dollar strength, reinforced by geopolitical tensions and ECB caution. Traders should monitor upcoming Eurozone data and global political developments for further price action.

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