The Euro (EUR) extended its decline against the US Dollar (USD) on Wednesday, slipping below the key 1.1600 level after a failed attempt to recover earlier this week. At the time of writing, the EUR/USD pair is trading around 1.1586, heading toward a one-week low.
The market mood remains cautious, with traders closely watching for insights from European Central Bank (ECB) President Christine Lagarde and several Federal Reserve (Fed) officials, who are set to speak later in the day.
📉 Pressure on EUR/USD Mounts
The recent weakness in EUR/USD follows a modest recovery attempt that quickly faded. With no major economic data releases from either the Eurozone or the US today, central bank commentary is taking center stage.
Markets are particularly focused on:
- Comments from ECB President Lagarde and Vice President Luis de Guindos
- Speeches from Fed officials including Alberto Musalem and Michael S. Barr
However, these speeches are not expected to provide any major surprises regarding the future direction of monetary policy.
🏛️ Political Uncertainty & Shutdown Worries Cap USD Gains
While the US Dollar has regained some ground, its rallies are being kept in check by ongoing political uncertainty. The prolonged US government shutdown continues to drag on, now entering its fourth week.
President Donald Trump has refused to meet with Democratic lawmakers until the government reopens, while the Senate has failed to pass a funding bill for the 11th time. This gridlock is hurting investor confidence and raising concerns over potential negative impacts on US GDP growth.
📊 Market Expectations for Central Banks
A Reuters survey released Tuesday showed that most economists expect the Fed to cut interest rates by 25 basis points at its upcoming October 28–29 meeting, with another cut possibly in December. However, 25 of the 33 economists surveyed warned that the Fed may go too far, potentially setting the stage for a very low terminal rate by the end of 2026.
On the Eurozone side, another Reuters poll confirmed expectations that the ECB will keep its Deposit Rate unchanged at 2% at its October 30 policy meeting, with more than half of analysts expecting no changes through 2026.
🔍 Technical Analysis: Bearish Momentum Builds for EUR/USD
Technically, EUR/USD remains under pressure, continuing its downward trend after being rejected near 1.1730 last week. On the 4-hour chart:
- The Relative Strength Index (RSI) is approaching oversold territory
- The MACD indicator remains well below its signal line, confirming bearish momentum
Key support levels to watch:
- 1.1545 – lows from October 9 and 14
- 1.1460 – the bottom of the current descending channel
Resistance levels:
- 1.1650 – Tuesday’s high
- 1.1728 – October 17 high
- 1.1775 – October 1 high
Unless the pair rebounds decisively above 1.1650, the trend remains tilted to the downside.
🌍 Currency Performance Snapshot
Here’s how the Euro (EUR) is performing against major currencies today:
| Base / Quote | % Change |
|---|---|
| EUR / USD | -0.13% |
| EUR / GBP | +0.21% |
| EUR / JPY | -0.23% |
| EUR / CAD | -0.08% |
| EUR / AUD | -0.06% |
| EUR / NZD | -0.09% |
| EUR / CHF | -0.12% |
🔎 EUR is strongest vs. GBP, but broadly under pressure elsewhere.
🗣️ Key Central Bank Speeches Today
✅ ECB President Christine Lagarde – 12:25 GMT
- Known for detailed press briefings on the Eurozone’s economic outlook.
- Hawkish tone = bullish for EUR.
- Dovish tone = bearish for EUR.
✅ Fed President Alberto Musalem (St. Louis Fed) – 14:50 GMT
- Brings nearly three decades of market and policy experience.
- Markets will watch for his take on inflation and interest rate outlook.
✅ Fed Governor Michael S. Barr – 20:00 GMT
- Influential in regulatory matters and monetary policy decisions.
- Comments could influence market expectations for future Fed moves.
🧾 Summary
- EUR/USD is under pressure, breaking below 1.1600 as traders await key central bank speeches.
- Fed rate cut bets and US political uncertainty are limiting USD strength.
- The Euro remains weak, with the ECB expected to hold rates steady.
- Unless we see a strong shift in sentiment or surprise commentary, EUR/USD may continue drifting toward 1.1545 or even 1.1460.