The Euro has fallen below $1.098, marking its lowest point since mid-August, primarily driven by competing monetary policies from the European Central Bank (ECB) and the US Federal Reserve. Recent data indicating sluggish growth and a dip in inflation within the Eurozone—falling below the ECB’s 2% target in Stember—have amplified speculation of a potential rate cut during the ECB’s upcoming October meeting, which could signify the third reduction this year. Key figures within the ECB, including Christine Lagarde, have expressed their inclination towards this policy shift.
Conversely, robust employment figures in the US have diminished the chances of significant rate cuts by the Federal Reserve, consequently bolstering the strength of the dollar and further weakening the Euro.
As trading commenced on Monday, October 7, the EUR/USD exchange rate decreased by 0.0001 or 0.00% to 1.0975, maintaining stability from the previous session. Analysts project that the Euro will stabilize around 1.10 by the end of this quarter, based on macro models and expert predictions. However, over a 12-month outlook, it is anticipated to trade at approximately 1.07.