The EUR/USD pair is trading near 1.1728 at the time of writing, moderately higher on the daily chart and a short distance from its highest levels in almost three weeks, at 1.1765, reached on Tuesday. The euro consolidates previous gains as the US dollar takes a defensive stance, as investors hold their breath, ahead of US President Trump’s speech at the Davos economic summit, scheduled for later today.
The single currency is drawing support from the weakness of the dollar, with the market selling all US assets, after Trump threatened some European countries with additional tariffs for opposing his plans to buy Greenland.
Investors hope the meeting at the World Economic Forum in Davos will help calm tensions, although Trump’s idea of revealing private messages from European leaders did little to calm matters.
European Central Bank President Christine Lagarde will also take the stage somewhat later, although her speech was overshadowed by rising geopolitical tensions.
Euro price today
The table below shows the percentage change of the Euro (EUR) against the major currencies listed today. The euro was the strongest against the Swiss franc.
| US dollars | euro | GBP | JPY | Canadian | Australian dollar | New Zealand dollar | Swiss franc | |
|---|---|---|---|---|---|---|---|---|
| US dollars | 0.10% | 0.07% | -0.16% | 0.03% | -0.25% | -0.24% | 0.27% | |
| euro | -0.10% | -0.02% | -0.26% | -0.07% | -0.35% | -0.31% | 0.17% | |
| GBP | -0.07% | 0.02% | -0.23% | -0.05% | -0.33% | -0.31% | 0.18% | |
| JPY | 0.16% | 0.26% | 0.23% | 0.19% | -0.09% | -0.07% | 0.42% | |
| Canadian | -0.03% | 0.07% | 0.05% | -0.19% | -0.28% | -0.26% | 0.22% | |
| Australian dollar | 0.25% | 0.35% | 0.33% | 0.09% | 0.28% | 0.02% | 0.53% | |
| New Zealand dollar | 0.24% | 0.31% | 0.31% | 0.07% | 0.26% | -0.02% | 0.48% | |
| Swiss franc | -0.27% | -0.17% | -0.18% | -0.42% | -0.22% | -0.53% | -0.48% |
The heat map shows the percentage changes in major currencies versus each other. The base currency is chosen from the left column, while the counter currency is chosen from the top row. For example, if you select EUR from the left column and move along the horizontal line to USD, the percentage change displayed in the box will represent EUR (base)/USD (quote).
Daily Summary Market Movers: Investors are selling US assets amid the dispute between the European Union and the United States
- Trump’s plans to seize control of Greenland and his threat to impose additional tariffs on European countries opposed to it led to sharp declines in the US dollar and US Treasuries this week. The “Sell America” trade took a break on Wednesday, as investors awaited signs of de-escalation at the Davos meeting.
- Meanwhile, the European Parliament is considering suspending the trade agreement with the United States reached in July, in response to threats over Greenland. “If he wants access to the single market without tariffs, let him be reliable,” Manfred Weber, head of the European People’s Party, said on Tuesday.
- ECB President Lagarde is widely expected to confirm that the bank is well placed to respond to economic uncertainty and hint at a steady monetary policy for the foreseeable future.
- The US Supreme Court will hear arguments in the Lisa Cook case on Wednesday, in another open policy front for President Trump: his quest to control the Federal Reserve’s Monetary Policy Committee.
- During the European session, ECB Governor José Luis Escrivá stressed that there are no reasons to cut interest rates further and that monetary policy is likely to remain steady in the coming months.
- In Tuesday’s economic calendar, Germany’s ZEW survey revealed that investor sentiment about the German economy improved to 59.6 in January, its best reading in more than four years, from 45.8 in December, beating expectations for a reading of 50. Sentiment about the current situation improved to -72.7 from -81 in the previous month, which is also above the market consensus of -75.5.
- In the US, the weekly ADP employment change showed an increase of 8K in net jobs in the four weeks leading up to December 27, down from 11.25K in the previous four weeks, confirming that job creation remains at low levels.
Technical Analysis: EUR/USD consolidates its gains above the 1.1700 area
The EUR/USD rebound has encountered resistance at the 78.6% Fibonacci retracement level of the early January sell-off, at 1.1761, and is consolidating gains above the 1.1700 area at the time of writing. Technical indicators are still bullish. The Moving Average Convergence Divergence (MACD) is holding above the zero line on the 4-hour chart, and the Relative Strength Index (RSI) is registering 67, near the overbought zone, reinforcing the positive bias.
Immediate support lies at the intraday low at 1.1710, closing the way towards Tuesday’s low near 1.1630 and the January 16 low of 1.1585.
On the upside, immediate resistance lies in the area between the 76.8% Fibonacci retracement mentioned at 1.1761 and the January 2 high at 1.1765. If the rise continues, the target is the December 24 high, just above 1.1800.
(The technical analysis for this story was written with the help of an artificial intelligence tool.)
Frequently asked questions about the euro
The euro is the official currency of the twenty European Union countries that belong to the eurozone. It is the second most traded currency in the world after the US dollar. In 2022, it accounted for 31% of all foreign exchange transactions, with an average daily trading volume of more than $2.2 trillion per day. The EUR/USD is the most widely traded currency pair in the world, accounting for a 30% discount on all transactions, followed by EUR/JPY (4%), EUR/GBP (3%), and EUR/AUD (2%).
The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the euro area. The European Central Bank sets interest rates and manages monetary policy. The ECB’s primary mandate is to maintain price stability, which means either controlling inflation or stimulating growth. Its primary tool is to raise or lower interest rates. Relatively high interest rates – or the expectation of higher interest rates – usually benefit the euro and vice versa. The ECB’s Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by the heads of the eurozone’s national banks and the six permanent members, including the President of the European Central Bank, Christine Lagarde.
Eurozone inflation data, measured by the Harmonized Index of Consumer Prices (HICP), is one of the important economic indicators for the euro. If inflation rises beyond expected, especially if it is above the ECB’s 2% target, this forces the ECB to raise interest rates to bring it back under control. Relatively high interest rates compared to their counterparts usually benefit the euro, because they make the region more attractive as a place for global investors to park their money.
Data releases measure the health of the economy and can affect the euro. Indicators such as GDP, manufacturing and services PMIs, employment, and consumer confidence surveys can all influence the direction of the single currency. A strong economy is good for the euro. Not only does it attract more foreign investment, it may encourage the European Central Bank to raise interest rates, which will directly strengthen the euro. Otherwise, if economic data is weak, the euro will likely fall. Economic data for the four largest Eurozone economies (Germany, France, Italy and Spain) are of particular interest, as they represent 75% of the Eurozone economy.
Another important data for the Euro is the trade balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports during a certain period. If a country produces highly desirable exports, its currency will gain value from the additional demand generated by foreign buyers seeking to purchase these goods. Therefore, a positive net trade balance strengthens the currency and vice versa for a negative balance.
