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EUR/USD has accelerated its upward climb, nearing weekly highs hovering around 1.15, exactly trading at 1.1495, up +0.66% at the time of writing, driven by a significant pullback in the US Dollar. The Greenback’s weakness intensified after May’s US CPI data fell short of expectations, dampening investor confidence. Additionally, the recent US-China trade agreement has further pressured the Dollar, boosting the pair’s rally toward the 1.1500 mark.
Earlier on Wednesday’s North American trading session, the EUR/USD was trading firmly in positive territory above 1.1450 during the early American session on Wednesday. The pair has gained momentum, advancing toward 1.1500, and was last recorded at 1.1465, reflecting a daily increase of 0.35%. This uptick highlights the Euro’s strength, driven by a faltering US Dollar amid recent economic developments.
Euro’s Performance Against Major Currencies
The Euro has shown resilience against major currencies today, with the most significant gains against the New Zealand Dollar. A currency performance table illustrates the Euro’s strength: it rose 0.30% against the US Dollar, 0.18% against the British Pound, 0.20% against the Japanese Yen, 0.25% against the Canadian Dollar, 0.32% against the Australian Dollar, 0.40% against the New Zealand Dollar, and 0.04% against the Swiss Franc. This heat map, where the base currency is selected from the left column and the quote currency from the top row, underscores the Euro’s broad-based advance, particularly against the NZD.
US Dollar Weakens After Disappointing Inflation Data
The US Dollar has faced downward pressure following the release of softer-than-expected US inflation figures for May. The US Bureau of Labor Statistics reported that both the Consumer Price Index (CPI) and core CPI rose by just 0.1% monthly, falling short of market forecasts. Annually, CPI increased to 2.4% from 2.3% in April, below the anticipated 2.5%, while core CPI held steady at 2.8%. This underwhelming data triggered a decline in the US Dollar Index, which dropped approximately 0.3% to below 99.00, bolstering EUR/USD’s upward trajectory.
Trade Developments Fail to Lift USD
Recent progress in US-China trade negotiations has not provided the US Dollar with the expected support. President Donald Trump announced via Truth Social that China will supply “full magnets and any necessary rare earths” upfront, while the US will fulfill agreed-upon commitments, including access for Chinese students to US educational institutions. Current tariffs stand at 55% on Chinese goods and 10% on American goods entering China. Despite the positive tone, these developments have not strengthened the US Dollar, leaving EUR/USD to capitalize on the Greenback’s weakness.
What Lies Ahead for EUR/USD
With no major economic data releases scheduled for the remainder of Wednesday, market attention may shift to the 10-year Treasury note auction, which could influence the US Dollar’s valuation. For now, EUR/USD’s push toward 1.1500 reflects a combination of Dollar weakness and favorable market sentiment. Investors closely monitor upcoming economic indicators and trade-related updates, as these could dictate the pair’s next moves. The Euro’s current strength suggests potential for further gains, provided no significant disruptions arise.
