Neutral
EUR/USD trades at 1.1445 amid soft US inflation and escalating Middle East tensions.
Over the past 24 hours, EUR/USD has remained relatively stable around the 1.1445 mark. Softer-than-expected US inflation data has reduced expectations for an imminent Federal Reserve rate hike, while escalating tensions in the Middle East, particularly between the US and Iran, have introduced geopolitical uncertainties that may influence currency movements.
Key points
- US inflation data for June showed a softer-than-expected increase, leading markets to scale back expectations of an imminent Federal Reserve rate hike.
- The US has launched several strikes against Iran, while Tehran has responded with attacks on US bases in neighboring countries, escalating tensions in the Middle East.
- Oil prices have surged around 12% this week, reinforcing expectations that major central banks may need to keep monetary policy tighter for longer to contain inflation.
- The European Central Bank is expected to hold its deposit rate at 2.25% on July 23, with an 88% probability, as Eurozone inflation fell to 2.8% in June from 3.2% in May.
Sources
- EUR/USD Subdued by Data: Chances of Fed Rate Hike DiminishInvesting.com · July 17, 2026
- EUR/USD Price Forecast: Sideways trading extends with 1.1480 holding bullsFXStreet · July 17, 2026
- Euro steadies as markets weigh ECB and Fed interest rate expectationsFXStreet · July 17, 2026
- EUR/USD at 1.14 Hinges More on the Fed Than the ECBInvesting.com · July 17, 2026
AI-generated from public news sources. Not financial advice.
