The Euro (EUR) edged higher on Thursday, holding above the 1.1600 level, supported by stronger-than-expected Eurozone macroeconomic data and improving investor sentiment following progress in US–China trade talks. However, upside momentum remains limited as traders await the European Central Bank’s (ECB) policy announcement later in the day.
At the time of writing, EUR/USD trades around 1.1625, recovering from Wednesday’s lows near 1.1580. The pair is benefiting from a combination of upbeat Eurozone data and a modest improvement in global risk appetite after news of a trade agreement between the United States and China.
Eurozone Data Surprises to the Upside
According to Eurostat’s preliminary estimate, the Eurozone economy expanded 0.2% quarter-on-quarter (QoQ) in Q3, exceeding expectations for 0.1% growth. On an annual basis, GDP rose 1.3%, slightly above forecasts of 1.2%, though slower than the 1.5% pace recorded in Q2.
Meanwhile, the European Commission’s Economic Sentiment Indicator (ESI) climbed to 96.8 in October from 95.6 in September, topping market expectations of 95.7. Confidence in both the industrial and services sectors improved, while consumer confidence held steady at -14.2. The Eurozone unemployment rate remained unchanged at 6.3% in September, in line with forecasts.
In Germany, preliminary GDP data confirmed that the economy stalled (0.0%) in Q3, following a 0.3% contraction in Q2. On a yearly basis, GDP rose 0.3%, matching estimates.
Sino–US Trade Progress Lifts Sentiment
Market mood brightened slightly after US President Donald Trump described his meeting with Chinese President Xi Jinping as “amazing,” announcing that US tariffs on Chinese goods will be cut to 47% from 57%. In return, China pledged to resume US soybean imports, maintain rare earth exports, and curb fentanyl trade.
President Xi called the talks “constructive,” noting that both sides reached a consensus on “important economic and trade issues.” Despite the positive tone, investors remain cautious, keeping overall sentiment fragile.
Fed’s Policy Outlook Adds to USD Volatility
On Wednesday, the Federal Reserve lowered interest rates by 25 basis points (bps) to the 3.75%–4.00% range, as expected. However, Fed Chair Jerome Powell’s remarks hinted at uncertainty over another rate cut in December, triggering a broad-based rally in the US Dollar. Powell emphasized that the path forward is “far from a foregone conclusion,” citing mixed signals from inflation and employment data.
Euro Performance Snapshot
| Base / Quote | USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF |
|---|---|---|---|---|---|---|---|---|
| USD | — | -0.14% | 0.00% | 0.41% | -0.00% | -0.05% | -0.07% | -0.13% |
| EUR | 0.14% | — | 0.14% | 0.57% | 0.14% | 0.09% | 0.07% | 0.01% |
| GBP | -0.00% | -0.14% | — | 0.40% | 0.00% | -0.04% | -0.07% | -0.13% |
| JPY | -0.41% | -0.57% | -0.40% | — | -0.41% | -0.45% | -0.51% | -0.57% |
| CAD | 0.00% | -0.14% | 0.00% | 0.41% | — | -0.03% | -0.08% | -0.13% |
| AUD | 0.05% | -0.09% | 0.04% | 0.45% | 0.03% | — | -0.03% | -0.08% |
| NZD | 0.07% | -0.07% | 0.07% | 0.51% | 0.08% | 0.03% | — | -0.03% |
| CHF | 0.13% | -0.01% | 0.13% | 0.57% | 0.13% | 0.08% | 0.03% | — |
The Euro remains strongest against the Japanese Yen, reflecting the modest recovery in global risk sentiment.
ECB Decision in Focus
The European Central Bank will announce its interest rate decision at 13:15 GMT. The deposit rate is widely expected to remain unchanged at 2.00%, marking a third consecutive hold. Markets will focus on ECB President Christine Lagarde’s comments for clues on whether policymakers consider the current level to be the terminal rate, or if additional easing remains possible in 2025.
Technical Outlook: EUR/USD Consolidates in a Triangle Pattern
EUR/USD continues to trade within a symmetrical triangle, indicating indecision ahead of major catalysts. Technical indicators lean slightly bearish:
- The 4-hour RSI remains below 44,
- The MACD has crossed below the signal line, and
- Wednesday’s bearish candle adds to downside pressure.
Support levels:
- 1.1580 (October 22–23 lows)
- 1.1545 (October 9 & 14 lows) — key downside target
- 1.1450 — measured target of the triangle pattern
Resistance levels:
- 1.1625 (October 28 low, now resistance)
- 1.1665–1.1670 (triangle top, October 28–29 highs)
- 1.1730 (October 17 high)
A breakout above 1.1670 could signal renewed bullish momentum, while a drop below 1.1545 would confirm a bearish continuation toward 1.1450.
Economic Indicators Summary
Eurozone GDP (QoQ, Q3 Preliminary)
- Actual: 0.2%
- Forecast: 0.1%
- Previous: 0.1%
(Source: Eurostat)
Eurozone Economic Sentiment Indicator (October)
- Actual: 96.8
- Forecast: 95.7
- Previous: 95.5
(Source: European Commission)
✅ Summary:
The Euro is steady above 1.1600 as upbeat Eurozone GDP and sentiment data offset lingering uncertainty around global growth and central bank policy. Traders are now awaiting the ECB’s decision for fresh directional cues.
