Dollar weakness driven by softer US jobs data cuts September Fed hike probability to under 50%, lifting EUR/USD past 1.15 resistance.
EUR/USD climbed above 1.15 resistance as the dollar weakened following softer US employment data, reducing the likelihood of a September Federal Reserve rate hike to less than 50%. The shift follows a 72% probability at the end of July, altering market expectations for the second half of the year.
The pair trades near fair value based on 2-year spreads but appears slightly expensive relative to natural gas. Analysts note that further gains could materialize if the European Central Bank raises rates again while the Fed pauses amid a deteriorating labor market.
The next resistance zone for EUR/USD is identified around 1.1610/1.1625, with dollar weakness tracing back to coordinated FX intervention in USD/JPY two weeks ago.