EUR/USD Dips as US Data Outshines ECB’s Steady Rates

The EUR/USD pair took a hit on Thursday, July 24, 2025, sliding over 0.20% to hover around 1.1749 after peaking at 1.1789. Robust US economic data overshadowed the European Central Bank’s (ECB) decision to hold interest rates steady, tilting the balance in favor of the dollar. The euro, which gained a modest 1.05% against the dollar this week, faced pressure as US labor market strength and mixed PMI results contrasted with the Eurozone’s uneven economic recovery.

US economic indicators painted a resilient picture, with weekly jobless claims dropping to 217,000 for the week ending July 19, signaling a robust labor market. However, steady continuing claims at 1.955 million hinted at challenges for the unemployed in securing new jobs. The US Services PMI surged, reflecting strong sector performance, while the Manufacturing PMI contracted despite hitting a 37-month high earlier. Political developments also stirred markets, as President Donald Trump’s visit to the Federal Reserve raised speculation about pressure for rate cuts, adding uncertainty to the dollar’s outlook.

In the Eurozone, the ECB maintained its three key interest rates, adopting a cautious, data-dependent stance amid internal debates. Flash PMI data showed improvement, but manufacturing remained in contraction, underscoring persistent economic headwinds. Despite these challenges, the euro held up relatively well against other major currencies this week, outperforming the pound and yen. As EUR/USD tests the 1.1750 level, traders eye upcoming US Durable Goods Orders and Eurozone data for clues on whether the pair can rebound or face further downward pressure in this tug-of-war between economic resilience and policy uncertainty.