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Euro edges higher near 1.1400 as oil slips but rate gap stays tight
Brent is around $84.0 and West Texas Intermediate near $79.0, a multi-day move that underlines how energy-driven inflation expectations are feeding into ECB and Fed rate differentials.
The euro traded just under 1.1400 on Tuesday, about 0.15% firmer after moving through a roughly 1.1350 to slightly above 1.1400 range, according to FXStreet.
FXStreet links the currency's intraday firmness to a third straight session of falling crude oil. Brent is near $84.00 and West Texas Intermediate near $79.00 as stand-down conditions between the United States and Iran extend into a fourth day.
The outlet argues the euro's improvement is limited because the European Central Bank has maintained a hawkish framing even after holding its deposit rate at 2.25% last week. It cites euro-area inflation of 2.8% year over year in June versus 3.2% in May, with ECB staff projecting an average near 3.0% for 2026, largely tied to energy.
FXStreet says rate expectations remain structurally supported by the Fed's inflation concerns, including import prices running above 7% year over year, tariff measures being extended, and delayed pass-through into food and materials. It notes rate futures show about a 30% chance of a July hike, about 91% odds for at least one hike by December, and about 58% odds for two or more.
Latest closeWTI crude $81.23 ▼1.7%|Brent $85.92 ▼2.8%