Revised 2026 growth projections narrow the US-Eurozone gap, capping further moves in the currency pair near current levels.
EUR/USD has stalled after retracing half its decline from 1.20 to 1.1325, trading in a tight range as investors await fresh US economic data. The pair’s consolidation follows downward revisions to 2026 US growth forecasts to 2.1% and upward adjustments for the Eurozone to 0.8%.
Relative growth expectations have driven rate differentials, with the exchange rate mirroring these shifts since spring. Analysts note the convergence reduces immediate catalysts for a breakout, absent further deterioration in US growth prospects or new market-moving events.
Markets remain focused on upcoming US employment and retail sales figures to gauge whether recent soft data trends persist, which could influence the pair’s next directional move.