EUR/USD stays low as it waits for US manufacturing figures and comments from Fed officials

As of Thursday, the EUR/USD pair remained constrained just under 1.1640, trading around 1.1635. This is concerning because it’s nearing a one-month low of 1.1618, despite some encouraging Eurozone industrial production numbers that came out earlier.

According to Eurostat, industrial production in the Eurozone rose by 0.7% in November, against expectations for a slowdown to 0.5%. Year-over-year growth also picked up, going from 2% in October to 2.5% in November, which was better than the anticipated 2% by analysts.

Yet, in the broader scheme of things, the euro continues to exhibit a bearish trend since its highs in late December. Positive data from the U.S. and diminishing worries about the Federal Reserve’s independence have been bolstering demand for the dollar.

Recent data from the U.S. showed an unexpected increase in producer prices and a solid rebound in retail sales for November. This may offer the Fed more reasons to pause interest rate changes moving forward.

On another note, President Donald Trump calmed markets by stating there are no plans to replace Federal Reserve Chairman Jerome Powell, despite ongoing investigations. Earlier worries about the Fed’s autonomy had pushed the dollar down, which led many central bankers to voice their support for Powell.

Looking ahead, investors are keeping an eye out for manufacturing reports from the Empire State and Philadelphia Fed, hoping they’ll affirm a brighter economic outlook for the U.S. in the fourth quarter of 2025. These reports might influence the upcoming speeches from Fed policymakers.

Daily Digest Market Movement: US PPI and Retail Sales Data Supports USD

• The U.S. dollar continues to strengthen against most currencies as macroeconomic indicators lean toward a future pause in the Fed’s monetary policy.
• Wednesday’s Producer Price Index (PPI) data for November showed inflation was up to 3%, rather than the 2.7% forecasted, a notable jump from the previous month’s 2.8%. Core PPI also increased significantly, indicating stronger inflation than anticipated.
• The PPI report follows the Consumer Price Index (CPI) data released Tuesday, which indicated that price pressures in the U.S. remain persistent.
• Add to that, data from the Census Bureau revealed retail sales climbed by 0.6% in November, after a slight dip in October, surpassing expectations of a 0.4% increase. This suggests stable consumer spending and supports the notion of a robust U.S. economy as the year wraps up.
• Geopolitical concerns have somewhat eased, with Trump suggesting that unrest in Iran has lessened, although experts caution against potential military actions. This commentary has led to a pullback from safe-haven investments like oil and precious metals, potentially impacting the dollar’s growth.
• Meanwhile, Eurostat is set to release further industrial production figures for the Eurozone later on Thursday, which are anticipated to show a 0.5% increase in production for November, following a 0.8% rise in October.
• In the U.S., the New York Empire State Manufacturing Index alongside the Philadelphia Fed Manufacturing Survey will shed light on sector activity, setting the stage for speeches from various Fed presidents.

Technical analysis: EUR/USD remains near the low of 1.1618

Currently, EUR/USD is at 1.1635, marking a shift within a downward trend channel since late December, reversing from recent highs near 1.1700. The MACD on the 4-hour chart indicates a neutral tone, while the RSI sits at 38, hinting at growing bearish momentum.

Bearish traders are eyeing the January 9 low of 1.1615. Below that, the region near 1.1600, where the channel’s bottom is situated, and the December 2 low of 1.1590 could also attract attention. On the upside, resistance may come into play around Wednesday’s high of 1.1660, before reaching the 1.1690 channel highs and the January 12 peak at about 1.1700.

(Technical analysis in this report was generated with assistance from AI tools.)