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Euro rises as broad dollar weakens ahead of ECB decision

EUR/USD was around 1.1647, supported by a weaker DXY near its August lows and rising expectations for an ECB 25 bps rate hike on Thursday.

Reported · Written up by our desk · Major Pairs

EUR/USD gained on Wednesday as broad US dollar weakness helped lift the euro, with the pair trading around 1.1647, up 0.20% on the day, according to FXStreet.

FXStreet also noted that the US Dollar Index was around 98.65, near its lowest level since August 21, while USD/JPY hovered near 153.35. The dollar trend was linked to a sharp rally in the Japanese yen, which pushed USD/JPY down roughly 4% so far this month.

Traders kept positioning cautious ahead of major catalysts, including the European Central Bank’s monetary policy announcement on Thursday and US inflation data later in the week. The ECB decision is widely expected to raise rates by 25 basis points, with ECB President Christine Lagarde’s press conference viewed as key for any signals on additional rate increases.

FXStreet said the backdrop includes elevated energy prices linked to the Middle East conflict, with West Texas Intermediate oil around $93.50 per barrel. It also cited inflation concerns, including Eurozone HICP accelerating to 3.3% year over year in August, while the benchmark 10-year US Treasury yield traded around 4.80%.

Latest closeEUR/USD 1.163 ▲0.0%|USD/JPY 153.54 ▼0.2%|Dollar index 98.84 ▼0.3%

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