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    EUR/USD recovers slightly after hitting 1.1580 and is now trading around 1.1620 as focus shifts to the ECB.

    by VT Markets
    /
    Oct 30, 2025

    Trade Tensions Ease

    After a positive meeting between U.S. President Trump and China’s President Xi, trade tensions have relaxed. Tariffs are down, and trade has resumed. However, the market’s reaction has been somewhat cautious. The Federal Reserve surprised investors with a rate cut, impacting the U.S. Dollar and changing expectations for future cuts. In the Eurozone, GDP growth hit 1.3% year-over-year, with signs of improving economic sentiment and confidence. Germany’s economy paused in Q3 after shrinking in the previous quarter, but annual GDP has bounced back to a 0.3% growth rate. The European Central Bank’s (ECB) upcoming decision is eagerly awaited, especially since it is expected to keep rates steady. The EUR/USD currency pair is forming a triangle pattern, showing mixed signals. Support is at 1.1580, while resistance is near 1.1625. Recent GDP data from Eurostat and the Economic Sentiment Indicator offer insights into the Eurozone’s economic situation.

    Monetary Policy Dynamics

    The U.S. Dollar is gaining strength following recent comments from the Federal Reserve, and this trend looks likely to continue. Core inflation data from September 2025 held steady at 3.1% year-over-year, indicating the Fed may not signal any more rate cuts this year. This situation makes the Dollar more appealing compared to the Euro, so we should be cautious about any major gains in EUR/USD. While Eurozone’s unexpected 0.2% GDP growth is a positive sign, it’s important to remember that it follows a long stretch of economic stagnation in 2023 and 2024. Flash inflation figures for the Eurozone in October 2025 showed 2.4%, which gives the ECB little reason to adopt a more aggressive policy in their upcoming meeting. We expect the ECB to maintain its deposit rate at 2.0%, further enhancing the interest rate advantage of the U.S. Dollar. Create your live VT Markets account and start trading now.

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