EUR/USD Consolidates Gains Ahead of Eurozone GDP and Employment Figures
The EUR/USD currency pair is experiencing marginal gains on Friday, trading near 1.1650 at the time of writing, after being rejected at 1.1675 during the early European session. Despite this, downside attempts remain limited, with markets anticipating a quarter-point interest rate cut by the Federal Reserve next week.
Economic data released on Thursday revealed an unexpected decline in US initial jobless claims in the last week of November, although the figures might have been influenced by the Thanksgiving holidays. Additionally, US Challenger Job Cuts decreased by 53% in November, to 71,321 from 153,074 in October, but hiring plans remained stagnant in the uncertain economic climate.
In the Eurozone, the focus shifts to the third estimation of Q3 Gross Domestic Product (GDP) and Employment Change during the European session. However, the main attention will be on September's delayed US Personal Consumption Expenditures (PCE) Price Index, the final inflation gauge before the Fed's monetary policy meeting next week.
Euro Price Analysis
The table below illustrates the percentage change of the Euro (EUR) against major currencies. The Euro demonstrated the strongest performance against the US Dollar.
USD EUR GBP JPY CAD AUD NZD CHF
USD -0.07% -0.15% -0.12% -0.08% -0.20% -0.09% -0.08%
EUR 0.07% -0.08% -0.07% -0.01% -0.12% -0.02% -0.02%
GBP 0.15% 0.08% 0.00% 0.08% -0.04% 0.06% 0.07%
JPY 0.12% 0.07% 0.00% 0.05% -0.07% 0.02% 0.04%
CAD 0.08% 0.00% -0.08% -0.05% -0.13% -0.03% -0.00%
AUD 0.20% 0.12% 0.04% 0.07% 0.13% 0.10% 0.11%
NZD 0.09% 0.02% -0.06% -0.02% 0.03% -0.10% 0.01%
CHF 0.08% 0.02% -0.07% -0.04% 0.00% -0.11% -0.01%
The heat map showcases percentage changes in major currencies against each other, with the base currency on the left and the quote currency on top. For instance, selecting the Euro from the left and moving horizontally to the US Dollar, the displayed percentage change represents EUR/USD.
Market Movers: US Dollar's Defensive Position Amid Fed Rate Cut Expectations
The US Dollar continues to be the worst performer among G8 currencies this week. The disappointing ADP Employment Change report earlier this week reinforced hopes of a Fed rate cut next week, while European manufacturing activity data exceeded expectations, bolstering the Euro.
On Thursday, Eurozone Retail Sales fell short of expectations with a 0% growth in October, missing the market's forecast of 0.1% growth. September's data was revised upward to a 0.1% rise from the previously estimated 0.1% decline. The Euro experienced a brief pullback after the release but quickly recovered.
US Initial Jobless Claims dropped to 191,000 in the last week of November, their lowest level in three years, from 218,000 the previous week. The market cautiously interpreted these figures, considering potential job seekers holding off on unemployment claims during the Thanksgiving holidays.
Futures markets predict an 87% chance of a 25 basis points Fed interest rate cut at their December 10 meeting, with two to three more cuts expected next year, according to the CME Group's Fedwatch Tool. Additionally, news of White House economic adviser Kevin Hassett potentially replacing Jerome Powell as Fed chairman is impacting the US Dollar, as bond investors have complained to the US Treasury, fearing an aggressive easing cycle under Hassett.
Technical Analysis: EUR/USD Bulls Face Resistance Below 1.1680
The EUR/USD pair maintains its bullish trend, with downside attempts contained above the trendline support at 1.1630. The 1.1670-1.1680 area continues to challenge bulls. The 4-hour Relative Strength Index (RSI) remains above the 50 level, currently at 61, while the Moving Average Convergence Divergence (MACD) indicator has crossed below the zero line, suggesting a loss of bullish momentum.
To sustain the rally, bulls must surpass Thursday's high of 1.1682, targeting the October 17 high near 1.1730, followed by the October 1 high at 1.1778. Conversely, a bearish reaction below 1.1630 could entice bears to retest the weekly lows at 1.1595, with further downside targets at 1.1550-1.1555.
Economic Indicators: Gross Domestic Product (GDP)
The Gross Domestic Product (GDP), released quarterly by Eurostat, measures the total value of goods and services produced in the Eurozone during a specific period. GDP and its aggregates are crucial indicators of economic health. The QoQ reading compares economic activity in the reference quarter to the previous one, with a rise generally bullish for the Euro and a low reading bearish.
Next Release: Friday, December 5, 2025, 10:00 AM
Frequency: Quarterly
Consensus: 0.2%
Previous: 0.2%
Source: Eurostat
(Note: The GDP YoY indicator is not included in the provided text but is available in the original content.)
