EUR\/USD fell for a fourth straight day on Thursday, reaching its lowest level since 23 January and trading near 1.1748. The move came as softer expectations for near-term US rate cuts supported the US Dollar.<\/p>\n
The US Dollar Index was near 98.00, its highest level since 6 February. US Initial Jobless Claims dropped to 206K in the week ending 14 February versus 225K forecast and 229K prior, while the four-week average eased to 219K from 220K.<\/p>\n
The Philadelphia Fed Manufacturing Survey rose to 16.3 in February, above the 8.5 forecast and up from 12.6 in January. US trade figures were weaker, with the Goods and Services Trade Balance at $-70.3 billion in December versus a $-55.5 billion forecast and $-53 billion previously.<\/p>\n
The Goods Trade Balance deficit widened to $-99.3 billion from $-86.9 billion. Focus turns to Friday\u2019s Core PCE Price Index, the advance estimate of Q4 US GDP, and preliminary February PMI data.<\/p>\n
Markets still price in nearly two US rate cuts this year, while the Fed\u2019s January minutes indicated no rush to ease as inflation remains above 2% and further hikes could be considered. The ECB is widely expected to keep rates unchanged through 2026, with Eurozone consumer confidence and flash PMIs also due.<\/p>\n
As we look at the EUR\/USD pair today, February 19, 2026, the situation feels familiar yet distinctly different from this time last year. The US Dollar’s strength continues to be a major theme, but the economic drivers have shifted significantly. The policy divergence between the Federal Reserve and the European Central Bank we saw developing in early 2025 has only widened, creating clear opportunities.<\/p>\n
Looking back at the data from February 2025, we saw exceptionally strong US Jobless Claims at 206K, which fueled a hawkish Fed stance. Today, the latest claims data from last week showed a reading of 218K, which while still historically low, indicates a slight cooling in the labor market’s momentum. This subtle softening is a key change from the red-hot numbers we were analyzing a year ago.<\/p>\n
This has shifted the conversation around the Federal Reserve’s policy away from potential hikes and toward the timing of inevitable cuts. While the Fed was in “no hurry” in early 2025, the latest Core PCE inflation reading of 2.8% for January 2026 has the market pricing in at least one rate cut by this summer. This is a stark contrast to last year when we were still debating the possibility of further tightening if inflation reaccelerated.<\/p>\n
On the other side of the Atlantic, the Eurozone’s economic picture remains sluggish, fulfilling the concerns we had in 2025. The flash manufacturing PMI for February 2026 came in at a weak 46.5, marking over a year of contractionary readings for the sector. This persistent weakness makes it highly likely the European Central Bank will act before the Fed, putting further downward pressure on the Euro.<\/p>\n
Given this widening policy gap, we see continued weakness for the EUR\/USD pair in the coming weeks. Traders should consider strategies that benefit from this downward trend, such as buying puts or establishing bear put spreads on EUR\/USD. The 1.1700 level represents a significant psychological support that could be tested soon.<\/p>\n
Attention must now turn to the upcoming US inflation data next week and the ECB’s commentary following their March meeting. Any sign of stickier-than-expected US inflation could delay Fed cuts and accelerate the EUR\/USD’s decline. Conversely, a surprisingly strong Eurozone data point could provide a short-term bounce, but we view the medium-term trend as firmly negative.<\/p>\n
Create your live VT Markets account<\/a>\u00a0and\u00a0start trading<\/a>\u00a0now. <\/b><\/p>\n","protected":false},"excerpt":{"rendered":" EUR\/USD slid to January lows near 1.1748 as stronger US data reduced rate-cut expectations.<\/p>\n","protected":false},"author":62,"featured_media":16959,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[59],"tags":[],"class_list":["post-42314","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-live-updates"],"acf":{"acf_article_selection_author":null},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts\/42314","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/users\/62"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/comments?post=42314"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts\/42314\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/media\/16959"}],"wp:attachment":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/media?parent=42314"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/categories?post=42314"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/tags?post=42314"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}