The EUR/USD pair is holding steady around 1.1770 early in the Asian trading session on Friday. Speculation surrounding the European Central Bank (ECB) indicates that there’s limited potential for the euro (EUR) to rise.
According to the Financial Times, ECB President Christine Lagarde may resign before completing her full eight-year term. Analysts believe that such a resignation could enable French President Emmanuel Macron and German Chancellor Friedrich Merz to select new leadership ahead of France’s presidential elections in April 2027.
On the other hand, robust U.S. labor market reports and a hawkish tone from the Federal Open Market Committee (FOMC) have lent some support to the U.S. dollar (USD), creating challenges for major currency pairs. Minutes from a recent FOMC meeting revealed that several Federal Reserve officials consider the possibility of raising interest rates if inflation continues to exceed the 2% target. They emphasized that future policies should take into account risks from both sides.
Traders are now looking forward to key U.S. economic data due for release later on Friday, including the preliminary fourth-quarter gross domestic product (GDP) and personal consumption expenditure (PCE) figures. If these reports come in weaker than expected, it could weaken the U.S. dollar against the euro. Additionally, preliminary Purchasing Managers’ Index (PMI) figures for the Eurozone and Germany will also be published.
