{"id":44627,"date":"2025-12-22T18:59:45","date_gmt":"2025-12-22T10:59:45","guid":{"rendered":"https:\/\/www.vtmarkets.com\/?p=37445"},"modified":"2025-12-22T18:59:45","modified_gmt":"2025-12-22T10:59:45","slug":"euro-stays-elevated-in-thin-holiday-trading","status":"publish","type":"post","link":"https:\/\/www.vtmarkets.com\/en-ca\/analysis\/euro-stays-elevated-in-thin-holiday-trading\/","title":{"rendered":"Euro Stays Elevated in Thin Holiday Trading"},"content":{"rendered":"\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"559\" src=\"https:\/\/www.vtmarkets.com\/en-ca\/wp-content\/uploads\/sites\/13\/2026\/03\/Image_fx-2025-10-03T175502582-1024x559.png\" alt=\"\" class=\"wp-image-31522\" \/><\/figure>\n\n\n\n<p><strong>Key Points<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>EURUSD traded just above $1.17, near its strongest level since late September.<\/li>\n\n\n\n<li>The ECB lifted its 2025 growth forecast to 1.4% from 1.2%, while inflation stays near 2%.<\/li>\n<\/ul>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity is-style-dots\" \/>\n\n\n\n<p>The euro traded just above $1.17 during a holiday-shortened week, holding close to its strongest level since late September. Price action remained steady rather than aggressive, reflecting reduced liquidity but firm underlying support.<\/p>\n\n\n\n<p>The move continues to reflect a widening divergence between the European Central Bank and the US Federal Reserve, with policy expectations leaning in favour of the single currency.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"twitter-tweet\" data-width=\"500\" data-dnt=\"true\"><p lang=\"en\" dir=\"ltr\">Pay growth in the euro area is set to accelerate in the latter half of 2026, supporting the ECB\u2019s assessment that there\u2019s currently no need to lower interest rates further <a href=\"https:\/\/t.co\/Jl3NradJYe\">https:\/\/t.co\/Jl3NradJYe<\/a><\/p>&mdash; Bloomberg (@business) <a href=\"https:\/\/twitter.com\/business\/status\/2001938721441009979?ref_src=twsrc%5Etfw\">December 19, 2025<\/a><\/blockquote><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script>\n<\/div><\/figure>\n\n\n\n<p>EURUSD last traded around 1.1732, up 0.22% on the session. Buyers continued to defend pullbacks, keeping the pair above the 30-day moving average and within a well-defined consolidation range.<\/p>\n\n\n\n<h2 class=\"wp-block-heading has-medium-font-size\">ECB Signals Stability as Growth Outlook Improves<\/h2>\n\n\n\n<p>Last week, the European Central Bank left interest rates unchanged for a fourth consecutive meeting.<\/p>\n\n\n\n<p>Policymakers signalled that rates are likely to remain at current levels for some time, pointing to resilience in the eurozone economy.<\/p>\n\n\n\n<p>Officials also noted that the region has handled US tariffs better than initially expected.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"twitter-tweet\" data-width=\"500\" data-dnt=\"true\"><p lang=\"en\" dir=\"ltr\">ECB Governing Council member Martins Kazaks said the economy has been faring better than expected but officials must keep all possibilities on the table because of continued uncertainty globally <a href=\"https:\/\/t.co\/n3M39YsfjE\">https:\/\/t.co\/n3M39YsfjE<\/a><\/p>&mdash; Bloomberg (@business) <a href=\"https:\/\/twitter.com\/business\/status\/2001977899281236036?ref_src=twsrc%5Etfw\">December 19, 2025<\/a><\/blockquote><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script>\n<\/div><\/figure>\n\n\n\n<p>Recent data releases have surprised to the upside, prompting the ECB to <a href=\"https:\/\/t.co\/IjpcGTLoCo\">up<\/a><a href=\"https:\/\/t.co\/IjpcGTLoCo\" target=\"_blank\" rel=\"noopener\" title=\"\">g<\/a><a href=\"https:\/\/t.co\/IjpcGTLoCo\">rade its growth outlook again<\/a> after a similar revision in September.<\/p>\n\n\n\n<p>The central bank now forecasts eurozone growth at 1.4% in 2025, up from a previous estimate of 1.2%.<\/p>\n\n\n\n<p>Headline inflation is projected to hover around the 2% target through 2028, reinforcing the case for a prolonged pause rather than near-term easing.<\/p>\n\n\n\n<p>This steady outlook continues to underpin the euro, especially against currencies where rate cuts appear closer.<\/p>\n\n\n\n<h2 class=\"wp-block-heading has-medium-font-size\">Fed Rate Cut Expectations Weigh on the Dollar<\/h2>\n\n\n\n<p>Across the Atlantic, softer-than-expected US inflation data have shifted market expectations. Traders increasingly price in Federal Reserve rate cuts starting next year, reducing yield support for the dollar.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"twitter-tweet\" data-width=\"500\" data-dnt=\"true\"><p lang=\"en\" dir=\"ltr\">Federal Reserve Bank of Cleveland President Beth Hammack said monetary policy is in a good place to pause and assess the effects of 75 basis points of rate cuts in the economy. <a href=\"https:\/\/t.co\/nbCK2SERIb\">https:\/\/t.co\/nbCK2SERIb<\/a><\/p>&mdash; Bloomberg (@business) <a href=\"https:\/\/twitter.com\/business\/status\/2002806290733535414?ref_src=twsrc%5Etfw\">December 21, 2025<\/a><\/blockquote><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script>\n<\/div><\/figure>\n\n\n\n<p>This shift has narrowed rate differentials in favour of the euro, even without any fresh tightening signals from the ECB.<\/p>\n\n\n\n<p>The dollar\u2019s inability to regain momentum has allowed EURUSD to remain elevated, despite the absence of strong euro-specific catalysts during the week.<\/p>\n\n\n\n<h2 class=\"wp-block-heading has-medium-font-size\">Technical Analysis<\/h2>\n\n\n\n<p>EUR\/USD is currently trading at <strong>1.17321<\/strong>, up <strong>0.22%<\/strong> on the session, but price action shows signs of hesitation near the recent resistance zone around <strong>1.1733\u20131.1750<\/strong>.<\/p>\n\n\n\n<p>This level has been tested several times since August, but buyers have yet to produce a decisive breakout.<\/p>\n\n\n\n<p>The Moving Averages (MA 5, 10, 30) remain in a bullish alignment, suggesting that short-term sentiment still favours the upside.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" src=\"https:\/\/www.vtmarkets.com\/en-ca\/wp-content\/uploads\/sites\/13\/2026\/03\/image-31-1024x453.jpg\" alt=\"\" class=\"wp-image-37446\" \/><\/figure>\n\n\n\n<p>However, the price is consolidating just below the previous peak at <strong>1.19181<\/strong>, indicating a potential double-top risk if buyers fail to clear resistance.<\/p>\n\n\n\n<p>The <strong>MACD<\/strong> histogram is in mild positive territory but flattening, and the signal line convergence points to waning momentum. A pullback toward the <strong>1.1650\u20131.1600<\/strong> area could occur if bullish follow-through falters.<\/p>\n\n\n\n<h2 class=\"wp-block-heading has-medium-font-size\">Cautious Outlook as Markets Await Fresh Catalysts<\/h2>\n\n\n\n<p>EURUSD may continue to trade sideways near current levels as liquidity returns and markets reassess Fed timing expectations.<\/p>\n\n\n\n<p>As long as the pair holds above 1.1600, downside pressure may stay limited. A sustained break above 1.1800 would require firmer evidence of US rate cuts, while a dip below support would likely need a shift in ECB tone or stronger US inflation data.<\/p>\n\n\n\n<p><strong>Learn more about trading <a href=\"https:\/\/www.vtmarkets.com\/forex\/\" target=\"_blank\" rel=\"noopener\" title=\"\">Forex<\/a> on VT Markets <a href=\"https:\/\/www.vtmarkets.com\/Insights\/\" target=\"_blank\" rel=\"noopener\" title=\"\">here<\/a>.<\/strong><\/p>\n\n\n\n<p><\/p>\n","protected":false},"excerpt":{"rendered":"<p>EURUSD trades above 1.17 as ECB stays patient and Fed rate cut bets grow, keeping the euro supported near recent highs. &#8211; vtmarkets.com<\/p>\n","protected":false},"author":64,"featured_media":31522,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[31],"tags":[56,10],"class_list":["post-44627","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-analysis","tag-euro","tag-forex"],"acf":{"acf_article_selection_author":""},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts\/44627","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\/64"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/comments?post=44627"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts\/44627\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/media\/31522"}],"wp:attachment":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/media?parent=44627"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/categories?post=44627"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/tags?post=44627"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}