Euro: Fed focus keeps pressure against US Dollar – Commerzbank
Commerzbank’s Volkmar Baur notes that EUR/USD slid to its lowest level since May 2025, but recent Eurozone data and the ECB Bank Lending Survey may be overshadowed by the upcoming Fed decision.
The EUR/USD currency pair witnessed its lowest level since May 2025, driven by focus on the upcoming Federal Reserve decision. Though recent Eurozone data and the ECB Bank Lending Survey may have been overshadowed by the Fed's decision, markets anticipate a December hike and two more hikes next year, keeping the Dollar firm. At one point, the euro experienced greater pressure when the ECB's Bank Lending Survey revealed a marked decline in new loan demand, attributed to weaker investment plans and higher interest rates.
However, this does not alter the expectations that the Fed will keep rates unchanged and possibly raise them in December. As the focus shifts to the Fed, the EUR/USD is likely to be overshadowed by the rate decision and Kevin Warsh's subsequent press conference.
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