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Euro falls even amid strong Eurozone PMIs

  • EUR/USD trades lower near 1.1370 despite stronger-than-expected German and Eurozone PMI data.
  • US Services PMI jumped to 53.6, keeping the US Dollar supported, while Manufacturing PMI eased to 53.8.
  • Attention turns to next week’s Fed meeting with rates expected to remain at 3.50%–3.75%.

EUR/USD trades lower near the 1.1370 area on Friday, struggling despite stronger-than-expected Eurozone business-activity figures. The US Dollar Index (DXY) remains firmer near 101.50, offering limited support to the pair.

Germany’s preliminary HCOB Composite Purchasing Managers Index (PMI) climbed to 51.2 in July from 49.5, exceeding expectations of 49.8 and returning to expansion territory. Manufacturing PMI improved to 52.2 from 50.3, while Services PMI rose to 49.6 from 48.6 but remained below the 50.0 threshold separating expansion from contraction.

Activity across the wider Eurozone also strengthened. The Composite PMI increased to 51.9 from 50.0, beating the 50.3 forecast. Manufacturing PMI advanced to 52.0, while Services PMI rose sharply to 51.6 from 49.4, indicating that the services sector returned to expansion.

The United States (US) preliminary S&P Global Manufacturing PMI eased to 53.8 and missed expectations of 54.5, while the Services PMI surged to 53.6 from 51.2, significantly exceeding the 51.0 forecast. The strong services reading may keep US Treasury yields supported and prevent a deeper decline in the Greenback.

Risk sentiment also improved after reports that Pakistan and Iran are exploring a potential path toward renewed US-Iran negotiations under a China-backed diplomatic initiative. A possible reduction in regional tensions has contributed to a sharp decline in Oil prices and reduced some safe-haven demand for the US Dollar, although significant obstacles to negotiations remain.

Investors will now turn their attention to the Federal Reserve’s (Fed) July 28–29 meeting. The Fed is expected to maintain its target range at 3.50%–3.75%. The meeting will not include new economic projections or an updated dot plot, leaving the policy statement and Chair Kevin Warsh’s press conference as the main drivers for EUR/USD.

Chart Analysis EUR/USD

Short-term technical analysis:

On the 4-hour chart, EUR/USD trades at 1.1369 with a bearish near-term bias, holding beneath both the 20-period Simple Moving Average (SMA) at 1.1397 and the 100-period SMA at 1.1422. The pair is also trading under nearby horizontal caps at 1.1387 and 1.1391, reinforcing a topside ceiling, while the Relative Strength Index (RSI) hovers near 37, hinting at persistent downside pressure but not yet oversold conditions.

On the downside, immediate support is clustered just below the market at 1.1368 and 1.1366, where a break would open the door to an extension of the recent decline. On the topside, a recovery above the 1.1387–1.1391 band is needed to ease immediate pressure, with the 20-period SMA at 1.1397 then acting as the next barrier ahead of the 100-period SMA at 1.1422, whose clearance would be required to challenge the broader bearish structure.

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NZD/USD Price Forecast: Kiwi tests 0.5800 as bullish momentum fades

  • NZD/USD tests 0.5800 as 50-day SMA caps recovery.
  • RSI turns bullish but fading slope warns of downside risk.
  • Break below 0.5762 exposes 0.5743 and 0.5700 supports.

The New Zealand Dollar gains over 0.30% against the US Dollar on Friday. The pair is poised to test key resistance levels with the 50-day Simple Moving Average (SMA) at 0.5793, slightly below the 0.5800 figure. At the time of writing, the NZD/USD trades at 0.5789, after bouncing off daily lows of 0.5767.

NZD/USD Price Forecast: Technical outlook

The Kiwi Dollar seems to recover during the day, but the overall trend is downwards, until the pair reclaims the May 29 high of 0.5995. Momentum turned bullish as depicted in the Relative Strength Index (RSI), but seems to be fading as the index is about to pierce bearish territory.

As of writing, the NZD/USD is testing key resistance below 0.5800. A breach of the latter will expose the confluence of the 100- day and 200-day Simple Moving Averages (SMAs) at 0.5823, followed by the July 21 high at 0.5874. Above this area, the next resistance is the 0.5900, followed by the May 29 high beneath 0.6000.

On the other hand, if NZD/USD breaches the low of the week (LOW) of 0.5762, it opens the door for further downside. The next key support is the July 13 low of 0.5743, followed by 0.5700. Beneath lies the July 7 high at 0.5672.

NZD/USD daily price chart

NZD/USD daily chart
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EUR/JPY Price Forecast: Cross consolidates under 187.00, bulls target 188.00

  • EUR/JPY remains capped within 186.00-187.00 as intervention fears linger.
  • RSI holds bullish territory, signaling buyers retain momentum advantage.
  • Break above 187.00 exposes YTD high and 190.00 resistance.

The EUR/JPY consolidates around 186.00, edges down by 0.06% amid a souring of risk appetite amid the escalation of the US-Iran war, and strengthens safe-haven assets like the Japanese Yen.

EUR/JPY Price Forecast: Technical outlook

The EUR/JPY trades sideways after reaching the year-to-date (YTD) high of 187.95. The cross-pair dipped toward the 183.00 area following the Bank of Japan’s (BoJ) last intervention, and since then buyers have reclaimed key resistance levels to reach the 186.00 mark.

At the time of writing, the EUR/JPY remains capped within the 186.00-187.00 range, amid fears that Japanese authorities could intervene in the foreign exchange markets. But bulls seem to be gaining momentum as indicated by the Relative Strength Index (RSI) in bullish territory.

Buyers need to clear 187.00 to challenge the YTD high at 187.95. Once those levels are taken out, the next resistance would be the 189.00 mark ahead of the 190.00 psychological level. 

On the other hand, if sellers push the EUR/JPY below the July 20 low of 185.35, it exacerbates a move toward the 50-day Simple Moving Average (SMA) at 185.20, followed by the 100-day SMA at 185.05. Still lower lies the 200-day SMA at 183.29.

EUR/JPY daily price chart

EUR/JPY daily chart
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Chart of The Day – No changes in the Far East, USD/JPY Hits New Highs

USD/JPY is breaking out to new 40-year highs above 163.30 , and the market is signalling that the acceleration in the pace of the BOJ’s rate rises is already largely priced in.

Traffic conditions on the D1

The price has broken through the previous resistance level of 163.00 (purple line) and is reaching new highs in the 163.30–163.40 range, whilst the RSI (14) remains in a strong uptrend at around 69.4, close to the overbought zone. The candlesticks are holding above the EMA50 (161.32), EMA100 (160.13) and EMA200 (158.12), and the EMA configuration (rising, in the order 50 > 100 > 200) confirms a strong bullish trend. The price is close to the upper Bollinger Band (163.92), which signals strong momentum but also the risk of a short-term correction before the next attempt to break through the resistance at 164.00.

Why do the markets already price in faster BOJ rate rises?

The OIS (overnight index swap) market for 22 July 2026 implies a rate of 0.981 per cent, compared with an effective rate of 0.977 per cent, whilst contracts up to the 18 December meeting are already pricing in a rise to 1.277 per cent – effectively discounting approximately 1.2 rate rises in full. This means that reports of the BOJ’s readiness to accelerate the pace of rate rises come as no surprise to the market – investors began pricing in a more aggressive cycle well ahead of the consensus among economists.

This is also confirmed by the table of 1-month price changes: the cumulative change (“Total Change 1M”) for Japan is zero, which indicates that the market is no longer revising its forecasts upwards, but is instead stabilising following the earlier movement – the “faster pace” is, to a large extent, already behind us in terms of prices. Source: Bloomberg Financial LP

Carry trade remains dominant despite rate rises

The interest rate differential between Japan (1.00%, following a rise to a 31-year high) and the effective US rate (3.63%) remains huge, and the two-year US-Japan yield spread has widened to 285 basis points – its widest level since August last year. Even a potential further 25 bp rate rise would do little to reduce the appeal of this spread, which is fuelling carry trades based on the low cost of yen-denominated financing relative to high-yielding currencies such as the BRL, MXN and AUD.

The fundamental ‘loop’ driving the yen’s weakness

Apart from monetary policy, the yen is suffering from a ‘doom loop’ – Prime Minister Sanae Takaichi’s loose fiscal policy (debt-to-GDP ratio over 200 per cent) combined with the BOJ’s insufficiently tight monetary policy, which is pushing the yield on 10-year JGBs up to 2.90 per cent, the highest level in 30 years. Finance Minister Satsuki Katayama has once again signalled her readiness to take “decisive action” in the foreign exchange market, however, interventions to date (totalling around US$215 billion since 2022) have failed to reverse the trend of yen weakness on a sustained basis, which undermines the credibility of such announcements in the eyes of investors.

The options market confirms that there are no fears of a shock

The falling 1-month ATM implied volatility for USD/JPY since 2022, despite the deepening weakness in the spot market, suggests that options are not pricing in any significant risk of a sudden reversal – such as a sharp intervention or an unexpected rate hike – but rather a continuation of the current narrative regarding the currency. Source: Bloomberg Financial Lp

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Trade of The Day – GBP/JPY

Facts:

  • The bounced off the lower limit of 1:1 structure at 217.52
  • Main trend on the pair remains upward

Recommendation: Trade: Long GBPJPY at market price Target: 220.16 Stop: 216.92

Opinion: Looking at GBPJPY chart, one can observe that the price reached the key technical support on Tuesday. This support is marked with the lower limit of 1:1 structure (green rectangles), as well as previous price reactions. In addition the price sits above the 100-period moving average from the H4 interval. Should buyers manage to hold the price above the support area 217.52-217.80, another upward impulse may be on the cards. We recommend taking a long position on GBPJPY at market price with two targets: 215.85 and 216.30 We recommend placing a stop loss order at 216.92

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UK CPI set to show receding inflation in June as GBP/USD fails at May highs

  • The UK’s ONR Office publishes the June CPI data on Wednesday.
  • The UK headline CPI is expected to ease toward 2.7% from a year earlier.
  • Core inflation is also seen easing toward 2.5% over the last 12 months.

The UK Office for National Statistics (ONS) will release the June Consumer Price Index (CPI) figures on Wednesday at 06:00 GMT, a print that will matter for markets. Consensus expectations point to inflation pressures still above the Bank of England’s (BoE) target, although losing further momentum.

UK consumer inflation remains one of the most important inputs for the BoE and typically carries real weight for the British Pound (GBP). Following the latest cautious hold by the BoE on June 18, investors now favour a steady hand by the ‘Old Lady’ at its meeting on July 30.

What to expect from the next UK inflation report?

Headline UK CPI is expected to clock 2.7% in the year to June, a tad lower than the May reading. On a monthly basis, inflation is seen gaining 0.1%, adding to the 0.2% increase recorded the previous month.

Core inflation, which strips out the more volatile food and energy components and is therefore more closely watched by the BoE, is forecast at 2.5% on an annual basis, down a tenth of percent from May.

How will the UK CPI data affect GBP/USD?

The BoE met expectations and kept the bank rate unchanged at 3.75% on June 18. However, the 7–2 vote split carried a slightly more hawkish tone, with Megan Greene joining Huw Pill in supporting a 25-basis-point increase. But the larger message is patience, with policy still firmly in wait-and-see mode and market pricing that reflects that stance.

In his latest comments last week, Governor Andrew Bailey said the renewed hostilities in the Gulf highlighted the instability facing the global economy. Turning to the UK, he argued that the country was supported by both its fiscal framework and monetary policy, while stressing that the central challenge remained economic growth.

Bailey added that the UK’s core banking system was resilient and that debt levels were not overstretched. However, he warned that sustainable economic growth would not be possible without financial stability.

Implied rates currently suggest nearly 43 basis points of tightening by year-end, while consensus sees the central bank keeping its policy rate unchanged at its next gathering on July 30.

Back to technicals, Senior Analyst at FXStreet, Pablo Piovano, notes that the recent multi-week recovery in GBP/USD appears to have encountered some initial hurdle in the 1.3550-1.3560 band near the July tops. “In case bulls regain the upper hand, the next barrier emerges at the May top at 1.3653 (May 11), followed by the YTD ceiling at 1.3868 (January 27),” he adds.

On the downside, Piovano sees initial contention at current yearly lows near 1.3140 (June 24). “Further weakness from here could expose a move toward the November 2025 base at 1.3010 (November 5),” Piovano adds.

Piovano also points out that momentum indicators remain somewhat bullish for now as the Relative Strength Index (RSI) hovers just below 54, while the Average Directional Index (ADX) near 18 suggests the current trend lacks muscle.

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EUR/JPY Price Forecast: Tests ascending triangle top above 186.00

  • EUR/JPY is testing the ascending triangle’s upper boundary near 186.20.
  • The 14-day Relative Strength Index at 57.48 suggests constructive but not overbought momentum.
  • The initial support lies at the nine-day EMA at 185.66.

EUR/JPY extends its gains for the second successive day, trading around 186.20 during the Asian hours on Wednesday. The currency cross is retaining a bullish near-term bias as it holds above both the nine-period and 50-period Exponential Moving Averages (EMAs).

The 14-day Relative Strength Index (RSI) at 57.48 suggests constructive but not overbought momentum, reinforcing the scope for further gains as long as price stays above the nearby EMA band.

The daily chart technical analysis shows the currency cross is testing the upper boundary of the ascending triangle around 186.20, suggesting growing bullish momentum and a potential breakout to the upside. A decisive break above the triangle could trigger a powerful bullish continuation, which could expose the all-time high of 187.95, which was recorded on April 17.

On the downside, primary support sits at the nine-day EMA of 185.66, with additional backing at the 50-day EMA of 185.18 and the lower edge of the ascending triangle near 185.10. A sustained break below the triangle pattern would undermine the bullish setup, exposing the EUR/JPY cross to deeper downside toward the five-month low of 181.87, recorded on March 16, and the seven-month low of 180.81.

Chart Analysis EUR/JPY

Euro Price Today

The table below shows the percentage change of Euro (EUR) against listed major currencies today. Euro was the strongest against the Japanese Yen.

USDEURGBPJPYCADAUDNZDCHF
USD-0.07%-0.07%-0.03%-0.02%-0.05%-0.06%-0.00%
EUR0.07%0.00%0.07%0.05%0.00%0.03%0.07%
GBP0.07%-0.01%0.04%0.05%-0.00%0.01%0.06%
JPY0.03%-0.07%-0.04%0.00%-0.02%-0.04%0.03%
CAD0.02%-0.05%-0.05%-0.01%-0.03%0.02%0.02%
AUD0.05%-0.01%0.00%0.02%0.03%0.02%0.05%
NZD0.06%-0.03%-0.01%0.04%-0.02%-0.02%0.03%
CHF0.00%-0.07%-0.06%-0.03%-0.02%-0.05%-0.03%

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 Euro from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent EUR (base)/USD (quote).

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EUR/JPY Price Forecast: Holds gains above 185.50 near nine-day EMA support

  • EUR/JPY may rise toward the ascending triangle’s upper boundary near 186.10.
  • The 14-day Relative Strength Index is around 53 and signals steady momentum.
  • The initial support lies at the nine-day EMA at 185.46.

EUR/JPY edges higher after three days of losses, trading around 185.50 during the Asian hours on Tuesday. The currency cross is holding above both the nine-day and 50-day Exponential Moving Averages (EMAs), which reinforces a mildly bullish near-term bias.

The EUR/JPY cross is pressing into the upper end of its recent range while the 14-day Relative Strength Index (RSI) around 53 suggests constructive but not overstretched momentum. The daily chart technical analysis shows the currency cross is remaining within the ascending triangle, signalling aggressive buying pressure.

The EUR/JPY cross may find the initial resistance at the triangle’s upper boundary around 186.10. A decisive break above the triangle could trigger a powerful bullish continuation, which could expose the all-time high of 187.95, which was recorded on April 17.

On the downside, immediate support sits at the nine-day EMA of 185.46, with additional backing at the 50-day EMA of 185.12 and the lower edge of the ascending triangle near 185.00. A breakdown below the triangle pattern would undermine the bullish setup, exposing the EUR/JPY cross to deeper downside toward the March 16 five-month low of 181.87 and the seven-month low of 180.81.

Chart Analysis EUR/JPY
EUR/JPY: Daily Chart

Euro Price Today

The table below shows the percentage change of Euro (EUR) against listed major currencies today. Euro was the strongest against the Japanese Yen.

USDEURGBPJPYCADAUDNZDCHF
USD-0.04%-0.08%0.00%-0.01%-0.16%-0.41%0.00%
EUR0.04%-0.04%0.06%0.03%-0.10%-0.37%0.04%
GBP0.08%0.04%0.11%0.08%-0.05%-0.33%0.09%
JPY0.00%-0.06%-0.11%-0.01%-0.15%-0.43%0.00%
CAD0.00%-0.03%-0.08%0.01%-0.14%-0.40%0.01%
AUD0.16%0.10%0.05%0.15%0.14%-0.27%0.14%
NZD0.41%0.37%0.33%0.43%0.40%0.27%0.41%
CHF-0.01%-0.04%-0.09%-0.00%-0.01%-0.14%-0.41%

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 Euro from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent EUR (base)/USD (quote).