The Euro edges up as traders await a 25 basis point ECB rate hike to combat inflation amid energy supply risks.
The EUR/USD pair trades marginally higher at 1.1550 in Asian trading, supported by expectations of a European Central Bank rate increase. The ECB is set to raise its Deposit Facility Rate by 25 basis points to 2.25%, its first adjustment in eight meetings, to address surging inflation driven by energy prices.
ECB officials have signaled urgency in tightening policy, citing persistent inflation risks. Investors will focus on President Christine Lagarde’s remarks for clues on future moves, particularly regarding second-round inflation effects. Meanwhile, the USD remains under pressure, with the Dollar Index down 0.11% at 99.97.
Technical indicators suggest a bearish outlook for EUR/USD, with a downward-sloping 20-day EMA at 1.1603 and an RSI below 40 signaling potential selling pressure.