The euro is trading flat against the dollar as Friday's session begins in Europe. The single currency has declined nearly 1% against the US dollar this week, reflecting a bearish sentiment among traders. This outlook is driven by falling business confidence, contractions in manufacturing across the eurozone, and the prospect of increased international trade attrition once the incoming US administration takes office.
Yesterday's widely anticipated 25-basis-point rate cut, which lowered the ECB's reference rate to 3%, had minimal impact. Christine Lagarde's post-announcement comments aligned with the gloomy tone, revealing that some central bank officials had even advocated for a larger cut of 50 basis points. In this context, investors are closely monitoring further remarks from ECB officials, seeking clarity on the bank's likely rate trajectory. For now, the outlook for the euro remains bearish.
Ricardo Evangelista – Senior Analyst, ActivTrades
Source: ActivTrader
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