EUR/USD rises to near 1.1350 ahead of Eurozone HICP inflation data – FXStreet

• EUR/USD is supported by improving global risk sentiment.
• The euro could face headwinds as the market expects a 25 basis point rate cut by the ECB on Thursday.
• The CME FedWatch tool shows the market is priced at around 85 basis points by the end of the year.

EUR/USD traded around 1.1340 during Asian time on Wednesday, rebounding after two consecutive loss sessions. The pair has garnered support from more positive global risk sentiment supported by President Donald Trump’s decision to exempt key technology products from newly announced “mutual” tariffs.

However, the further benefits of the Euro (EUR) could be limited as the market is widely expecting the European Central Bank (ECB) to cut 25 basis points on Thursday. The move comes amid intensifying the fear of a recession related to US trade policy. The ECB has already cut its fees twice this year, with currently reducing deposit facility fees by 2.5%. This week’s cut will cut it to 2.25%.

Investors will watch ECB President Christine Lagarde’s press conference in detail about the signal on central bank policy direction for the remainder of the year and the potential economic impact of US tariff measures on the eurozone.

Meanwhile, the CME FedWatch tool shows that the market is priced at around 85 basis points per year-end Fed rate reduction, indicating that the Fed expects to maintain stable rates at upcoming meetings. Later that day, attention will be focused on US retail sales data for March, potentially providing further insight into how tariff uncertainty is affecting consumer spending.