The euro rallies to its highest level in two months as US economic data fuels doubts about Fed rate cuts and dollar strength.
EUR/USD climbed to 1.1588, its highest level in eight weeks, driven by a weaker dollar after fresh US economic data raised concerns about the stability of the US economy. The move reduced expectations of imminent Federal Reserve rate cuts, weighing on the greenback.
The pair’s rise follows a period of dollar dominance, with recent data suggesting softer US growth or inflation trends. Analysts note the euro’s resilience amid shifting monetary policy expectations, though the Fed’s next moves remain a key driver.
Markets are now pricing in a more cautious Fed stance, supporting the euro’s advance against the dollar.