On Wednesday, in European trading, the EUR/USD pair was up by 0.27%, hovering around 1.1800. The major currency pairs experienced a surge as the US dollar (USD) declined following President Donald Trump’s inaugural State of the Union address in front of Congress.
As of this moment, the US Dollar Index (DXY), a measure of the dollar’s value against six key currencies, was down 0.2%, settling around 97.65.
The US dollar appeared weakest against the Australian dollar, reflecting broader trends in the foreign exchange market today. It seems that uncertainty about the dollar is contributing to this decline.
During his address, President Trump highlighted his administration’s economic successes, while also critiquing the Supreme Court’s ruling on tariffs, which he deemed “unfortunate.” He emphasized that tariffs had played a significant role in the “economic turnaround.”
Looking ahead, the outlook for the dollar appears favorable as analysts predict that the Federal Reserve is unlikely to make interest rate cuts in March or April.
In the meantime, the euro (EUR) is gaining traction ahead of Friday’s release of the preliminary German Harmonized Consumer Price Index (HICP). Preliminary data suggested inflation pressures increased by 0.5% month-on-month, recovering from a 0.1% drop in January, with year-end projections pointing toward a steady rise of about 2.1%.
EUR/USD Technical Outlook
Currently, EUR/USD is trading at roughly 1.1805. The 14-day Relative Strength Index (RSI) indicates a balanced scenario, oscillating between the 40.00 to 60.00 range. The pair is moving around the 20-day exponential moving average of 1.1800, signifying a sideways movement.
Major currency pairs are nearing a critical point in a descending triangle pattern on the daily chart. A daily closing price above the February 23 peak of 1.1835 could signal further advances towards the key 1.1900 level. Conversely, if the price drops below the February 19 low of 1.1742, it might lead to a swift decline towards the January 22 low of 1.1670.
(Technical analysis in this report was assisted by AI tools.)
Economic Indicators
Harmonized Consumer Price Index (YoY)
The Harmonized Index of Consumer Prices (HICP) is published by the German Statistical Office. This monthly inflation gauge uses a standardized statistical method across EU member states for better comparison. Year-over-year comparisons help see how prices today stack up against a year ago. Generally, higher numbers tend to be bullish for the euro (EUR), while lower figures are considered bearish.
