EUR/USD edges higher as Dollar takes breather after weekly surge

March 27, 2026
  • EUR/USD rebounds as the US Dollar eases from intraday highs.
  • Weak US consumer sentiment contrasts with rising inflation expectations.
  • Markets reassess interest rate outlook amid elevated Oil prices and geopolitical risks.

EUR/USD edges higher on Friday after early weakness, as the US Dollar (USD) pulls back from intraday highs, offering some support to the Euro (EUR). At the time of writing, the pair trades around 1.1545, recovering from a daily low at 1.1501.

The pullback in the US Dollar appears largely technical, as buyers take a breather following a strong rally earlier this week that pushed the US Dollar Index (DXY) above the key 100.00 psychological level.

The index, which tracks the Greenback against a basket of six major currencies, is currently hovering near 99.85, reflecting a modest pause in upside momentum. However, it remains on track for weekly gains, staying broadly supported amid ongoing Middle East tensions.

On the data front, the University of Michigan figures came in weaker than expected. The Consumer Sentiment Index fell to 53.3 in March, down from the preliminary estimate of 55.5. The Consumer Expectations Index also declined to 51.7 from 54.1.

At the same time, inflation expectations moved higher. The 1-year outlook rose to 3.8% from 3.4%, while the 5-year expectation stayed at 3.2%.

Richmond Fed President Thomas Barkin said higher gasoline prices are weighing on consumer sentiment and could crowd out other spending. He added that even before the recent oil shock, progress on inflation was at risk of stalling. Barkin also noted that while the unemployment rate remains low, the labor market still feels fragile, highlighting risks to both sides of the Fed’s dual mandate.

On the geopolitical front, the lack of fresh headlines has kept trading conditions relatively calmer on Friday compared to earlier this week, when conflicting signals around potential US-Iran negotiations drove volatility. US President Donald Trump announced a delay in planned military strikes targeting Iran’s energy infrastructure. The deadline, initially set to expire on Friday, has now been extended by 10 days. 

However, with no clear signs of a resolution yet and the Strait of Hormuz largely closed, Oil prices remain elevated, continuing to fuel inflation concerns. This is prompting markets to reprice the interest rate outlook, with traders now pricing in 2-3 European Central Bank (ECB) hikes by year-end, while expectations for Federal Reserve (Fed) rate cuts are being trimmed, with some even seeing the possibility of a hike later this year.

GBP/USD holds above 1.3300 as haven bids lift the US Dollar

March 27, 2026
  • GBP/USD clings to 1.3300 as haven demand keeps the US Dollar supported.
  • UK Retail Sales slump and BoE caution weigh on Sterling sentiment.
  • Markets now see both the Fed and BoE leaning further hawkish.

The British Pound (GBP) holds firm during the North American session on Friday, clings above the 1.3300 figure, yet seems poised to finish the week with 0.20% losses against the US Dollar (USD). Risk aversion due to an energy shock caused by the Middle East conflict and the haven appeal of the Greenback keep GBP/USD on its way to monthly losses of more than 1%.

Sterling eyes weekly loss as Oil, war worries sour sentiment anew

On Thursday, US President Donald Trump announced a delay in attacks on Iran’s energy facilities for 10 days, until April 6. Initially, the markets cheered the move as Oil prices fell. Nevertheless, WTI reversed the initial drop as traders faded the news.

Hence, sentiment remains dismal, with Wall Street posting losses and the Greenback poised to finish the week with gains of over 0.45%, according to the US Dollar Index (DXY). The DXY, which tracks the buck’s performance versus six other currencies, is at 99.94, virtually unchanged for the day.

Adding to the sour mood was the fact that the Islamic Revolutionary Guard Corps (IRGC) shut off the Strait of Hormuz.

Data from the US showed that American consumers had grown pessimistic about the economy, as the University of Michigan Consumer Sentiment Index dipped from 55.5 to 53.3, below forecasts of 54. Inflation expectations for the next twelve months jumped from 3.4% in February to 3.8%, while for the five years were unchanged at 3.2%.

In the UK, Retail Sales fell in February following January’s strong performance, coming in at -0.4% MoM, a collapse from the previous month’s 2% growth.

Aside from this, Bank of England’s Alan Taylor said the bar for hiking interest rates is quite high, revealing that holding rates is preferable until the central bank assesses the impact of Iran’s war on the economy.

Traders expect further tightening by central banks

This week, money markets had priced out the possibility of rate cuts by the Federal Reserve and the Bank of England. Instead, they see the Fed raising rates by 5 basis points towards year-end. The BoE is projected to increase rates by 78 basis points, according to Prime Market Terminal data.

Fed interest rate probabilites – Source: Prime Market Terminal

(This story was corrected on March 27 at 16:25 GMT to say that the University of Michigan Consumer Sentiment Index dipped to 53.3, not 53.5, that 5-year inflation expectations remained unchanged at 3.2% and that UK Retail Sales for January came in at 2%, not 1.8%.)

GBP/USD Price Forecast: Technical outlook

Chart Analysis GBP/USD

In the daily chart, GBP/USD trades at 1.3311. The near-term bias is mildly bearish as spot holds below the clustered simple moving averages near 1.35 and remains capped by the descending resistance line from 1.3869, which has contained every rebound since the recent 1.38 area highs. Price slipping back inside the broad contracting formation between that downtrend line and the still-rising support line from 1.3035 signals fading upside momentum, while the latest downtick in the Fed Sentiment Index above 119.000 hints that relative policy expectations continue to favor the dollar at the margin.

Immediate resistance stands at the descending trend line currently intersecting just above 1.3400, followed by the 1.3500/1.3520 zone where the daily moving averages converge and prior swing highs cluster. A daily close above that confluence would weaken the bearish bias and expose the 1.3700 region, ahead of the 1.3869 high. On the downside, initial support emerges at 1.3220, the latest swing low, with further traction expected around 1.3100 aligned with the rising trend line from 1.3035. A break beneath that structural floor would confirm a deeper bearish extension toward the psychological 1.3000 handle.

EUR/GBP keeps hovering around 0.8650, unfazed by UK consumption data

March 27, 2026
  • The Euro remains practically flat around 0.8650, following UK Retail Sales data.
  • Markets pay little attention to February’s UK consumption figures, as they predate Iran’s war.
  • Inflation in Spain accelerated in March to its highest level since 2024.

The Euro (EUR) keeps trading sideways against the British Pound (GBP) on Friday, oscillating within a tight range around the 0.8650 level for the fourth consecutive day, on track for a 0.25% weekly decline. The stronger-than-expected UK  Retail Sales figures released earlier on the day have failed to provide any significant support to the Sterling.

Data released by National Statistics earlier on Friday revealed that retail consumption fell for the first time in the last three months in February, by 0.4%, following a 2% increase in January. The market consensus had anticipated a sharper, 0.8% decline.

Excluding fuel, sales of all other items have shown a similar pattern, falling 0.4% on the month after a 2.2% gain in January, yet remaining above the -0.8% market consensus. Year on year, Retail Sales growth eased to 2.5%, from an upwardly revised 4.8% growth in the previous month, while the Core Retail Sales slowed down to 3.4% from 5.9% in January.

These figures have had a limited impact on the market as they predate the start of the war in Iran. Data from March, which will show the impact of a sharp decline in consumer confidence and a sharp uptick in prices due to the surge in Oil prices, is likely to have more relevance.

The Euro, on the other hand, remains on its back foot, also weighed by the pressure of higher Oil prices in the Eurozone economy. Spain’s Consumer Price Index (CPI) accelerated to 3.3% year-on-year in March, its highest level in 14 months, adding pressure on the European Central Bank (ECB) to hike interest rates in April.

EUR/USD Price Forecast: Resumes downside after failing to hold above 200-day EMA

March 27, 2026
  • EUR/USD trades marginally lower around 1.1520 as the US Dollar remains firm amid Middle East conflicts.
  • Peace mediators dismiss Trump’s claim that the 10-day halt to attacks on Iranian energy plants was ordered as per Tehran’s request.
  • ECB’s Lagarde warns of persistent energy supply risks due to significant damage to Gulf energy infrastructure.

The EUR/USD pair trades subduedly around 1.1520 during the European trading session on Friday. The major currency pair faces slight selling pressure as the US Dollar (USD) trades firmly with hopes of a de-escalation in the Middle East war easing, which involves the United States (US), Israel, and Iran.

During the press time, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, trades 0.1% higher to near 100.00.

Investors turn doubtful over Mideast optimism amid the conflicting statements from peace mediators on US President Donald Trump’s claim that he ordered a pause on planned military strikes on Iran’s power plans as per Tehran’s request.

According to the Wall Street Journal (WSJ), peace talks mediators dismissed claims that Iran had requested a 10-day pause on strikes on its energy plants.

On the Euro (EUR) front, the major currency is expected to remain under pressure amid fears of persistent energy supply disruption in the wake of damage to Gulf energy infrastructure amid the war.

European Central Bank (ECB) President Christine Lagarde said in an interview with the Economist that the negative energy shock to the world economy from the Mideast war would be larger than current projections, as too much energy infrastructure has been damaged.

EUR/USD technical analysis

EUR/USD trades lower at around 1.1520 as of writing. The pair holds just above the 200-day EMA near 1.1540 while extending a sequence of lower highs below the 20-day EMA around 1.1590, keeping the near-term bias modestly bearish within a broader sideways context.

The 14-day Relative Strength Index (RSI) struggles to hold its recovery move into the 40.00-60.00 zone, signifying heavy selling pressure at higher levels.

Immediate resistance emerges at the 20-day EMA around 1.1590, with a daily close above this barrier needed to ease bearish pressure and open a move toward 1.1690. A stronger recovery would then target the 1.1810/1.1850 area, where prior highs cluster and the recent breakdown began. On the downside, initial support is located at 1.1500, guarding the late pullback low at 1.1415. A decisive break below 1.1415 would confirm a continuation of the downswing and expose the next support zone closer to 1.1350, where longer-term buyers would be expected to re-emerge.

Chart of The Day – USD/JPY

March 27, 2026

USDJPY remains under strong pressure, trading in the 159.50–159.80 range, close to the psychological barrier of 160.00. Current price movements are driven by a combination of dollar strength, concerns over potential Japanese government intervention, and macroeconomic and geopolitical factors.

Source: xStation5

What shapes USDJPY movements?

Dollar strength and global tensions
USDJPY is supported by the overall strength of the US dollar. Investors view the dollar as a safe-haven amid rising geopolitical tensions in the Middle East and uncertainty in commodity markets. Strong demand for the USD limits the potential for yen appreciation, especially in an environment of global unrest and increased risk aversion.

Risk of intervention by Japanese authorities
Japanese authorities have increasingly signaled their readiness to intervene if USDJPY exceeds the 160.00 level. The purpose of potential intervention is to protect Japanese exports and stabilize the economy. A strong dollar raises import costs and may increase inflationary pressure in Japan. Interventions serve as a tool for authorities to manage excessive currency fluctuations that could negatively impact the trade balance and financial market stability.

Monetary policy
The Bank of Japan continues its ultra-loose policy, maintaining low interest rates over the long term. At the same time, US rates remain elevated, widening the yield differential between the USD and JPY and supporting further dollar strength against the yen. This divergence in monetary policy makes the dollar more attractive to investors in the short and medium term, maintaining upward pressure on USDJPY.

Energy prices and Japan’s trade balance
Japan is heavily reliant on imported oil and gas. Rising energy prices increase import costs, weaken the trade balance, and limit growth potential. Higher commodity prices also add to inflationary pressure, increasing the risk of currency instability. In this context, a strong dollar combined with high commodity prices can further weaken the yen, keeping USD/JPY near record levels.

Conclusion

USDJPY remains sensitive to a combination of dollar strength, intervention signals from Japanese authorities, and external factors such as energy prices and geopolitical tensions. Strong dollar momentum and potential actions by the Japanese government limit the scope for stable gains above 160.00.

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Australian Dollar falls to two-month lows on US–Iran peace uncertainty

March 27, 2026
  • AUD/USD fell to a two-month low of 0.6877 on Friday.
  • Rising oil prices weighed on sentiment amid US–Iran peace uncertainty.
  • Trump said Washington would pause attacks on Iran’s energy sector for 10 days, while Tehran denied any request.

AUD/USD extends its losing streak for the fourth consecutive day, trading around 0.6880 during the Asian hours on Friday. The pair recorded a two-month low of 0.6877, pressured by weakness in the Australian Dollar (AUD) as rising oil prices weigh on sentiment amid uncertainty surrounding United States (US)–Iran peace talks.

US President Donald Trump said earlier that Washington would pause attacks on Iran’s energy sector for 10 days, extending the previous April 6 deadline to allow room for negotiations. Trump suggested the decision followed a request from Iran. However, the Wall Street Journal reported that mediators say Iran denies making such a request, underscoring the fragility of the diplomatic process and the low likelihood of a near-term ceasefire.

Meanwhile, the Pentagon is considering plans to deploy up to 10,000 additional ground troops to the Middle East. Defence officials noted that the option is intended to enhance strategic flexibility, enabling rapid escalation if talks break down while maintaining a credible deterrent in the region.

On the monetary policy front, Reserve Bank of Australia (RBA) Assistant Governor Christopher Kent warned on Thursday that policymakers may need to act to contain inflation as energy prices rise. Kent added that the board remains focused on achieving low, stable inflation and full employment, which could push up short-run neutral rates and necessitate tighter policy.

Federal Reserve (Fed) Governor Stephen Miran said on Thursday that reducing the size of the Fed’s balance sheet would support more effective interest rate policy. Miran outlined a potential path to shrink holdings by $1 trillion to $2 trillion, noting that a smaller balance sheet would give the Fed greater flexibility in future crises, while a larger one risks distorting markets.

US data offered little fresh direction, with Initial Jobless Claims coming in exactly as expected at 210K. Attention now turns to Friday’s University of Michigan (UoM) consumer sentiment and one-year inflation expectations.

EUR/USD inches up after Trump’s Hormuz deadline extension; remains below mid-1.1500s

March 27, 2026
  • EUR/USD attracts some buyers during the Asian session amid a modest USD downtick.
  • Trump extends the deadline to reopen the Strait of Hormuz, undermining the buck.
  • Persistent geopolitical uncertainty and hawkish Fed bets could limit the USD downside.

The EUR/USD pair edges higher during the Asian session on Friday, though it lacks bullish conviction and risks attracting fresh sellers amid a bullish US Dollar (USD). Nevertheless, spot prices, for now, seem to have snapped a three-day losing streak and currently trade around the 1.1535-1.1540 area, up nearly 0.10% for the day.

US President Donald Trump delayed a threatened strike on Iran’s energy infrastructure and extended his deadline for Tehran to reopen the Strait of Hormuz until April 6. This helps ease concerns about a further escalation of tensions in the Middle East and dents the USD’s safe-haven demand, which turns out to be a key factor offering some support to the EUR/USD pair.

Meanwhile, Iran has threatened to retaliate against regional infrastructure, including desalination facilities, if Trump follows through with his threat. Moreover, the deployment of additional US troops has been fueling speculation of a potential ground operation. This keeps geopolitical risks in play and should underpin the USD’s status as the global reserve currency.

Apart from this, hawkish US Federal Reserve (Fed) expectations might continue to act as a tailwind for the buck and cap the upside for the EUR/USD pair. Investors remain worried that the war-driven surge in energy prices would revive inflationary pressures and now seem to have fully priced out the possibility of any further interest rate cuts by the Fed this year.

Moreover, traders are rapidly increasing bets for a hike by the end of this year. The outlook remains supportive of elevated US Treasury bond yields and validates the USD bullish bias. This, in turn, warrants some caution for the EUR/USD bulls and makes it prudent to wait for some follow-through buying before positioning for any further intraday appreciating move.

US Dollar Price Today

The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Swiss Franc.

USDEURGBPJPYCADAUDNZDCHF
USD-0.10%-0.08%-0.14%-0.09%-0.07%-0.10%-0.04%
EUR0.10%0.02%-0.06%0.00%0.02%-0.00%0.06%
GBP0.08%-0.02%-0.09%-0.02%0.01%-0.03%0.04%
JPY0.14%0.06%0.09%0.07%0.06%0.04%0.12%
CAD0.09%-0.01%0.02%-0.07%0.00%-0.00%0.05%
AUD0.07%-0.02%-0.01%-0.06%-0.00%-0.02%0.04%
NZD0.10%0.00%0.03%-0.04%0.00%0.02%0.06%
CHF0.04%-0.06%-0.04%-0.12%-0.05%-0.04%-0.06%

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).

Canadian Dollar gains as US Dollar weakens on easing risk aversion

March 27, 2026
  • USD/CAD depreciates as market sentiment improves on the US pausing attacks on Iran’s energy sector.
  • The US Dollar may rebound as inflation fears curb Fed cut bets, boosting hike expectations.
  • The commodity-linked CAD may face challenges amid softer oil prices.

USD/CAD halts its four-day winning streak, trading around 1.3850 during the Asian hours on Friday. The pair weakens as the US Dollar (USD) softens on decreasing risk aversion after recent remarks from US President Donald Trump.

Trump said Washington would pause attacks on Iran’s energy sector for 10 days at Tehran’s request, extending the April 6 deadline to allow more time for negotiations. However, the Wall Street Journal reported that mediators said Iran denied making such a request, underscoring fragile diplomacy and low odds of a near-term ceasefire.

The Greenback may regain its ground on rising inflation concerns, prompting traders to scale back expectations of further Federal Reserve (Fed) rate cuts and increase bets on a potential hike by year-end.

Federal Reserve (Fed) Vice Chair of Supervision Philip Jefferson said higher energy prices should have a modest impact on inflation, though a sustained shock could be more significant. Meanwhile, Fed Governor Michael Barr warned that another price shock could lift inflation expectations, reinforcing the case for the Fed to assess economic conditions before adjusting policy.

The downside in USD/CAD may be limited as the commodity-linked Canadian Dollar (CAD) could struggle amid softer oil prices. Traders remain cautious as the Pentagon considers deploying up to 10,000 additional ground troops to the Middle East to maintain strategic flexibility and deterrence if talks fail.