EUR/USD Plummets as Trump Secures Victory, Fed Rate Cut in Focus
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EUR/USD tumbles to a four-month low near 1.0700 after Donald Trump’s decisive win in the US presidential election, driving the US Dollar (USD) higher. The Fed is expected to announce a 25 basis point rate cut on Thursday, adding to investor interest in US monetary policy. Meanwhile, the Euro is weighed down by fears that Trump's protectionist policies may deepen the Eurozone's economic struggles.
EUR/USD Falls Sharply as Trump Win Drives USD Higher
The EUR/USD pair has plunged, trading at its lowest levels since July, as Republican candidate Donald Trump secured the presidency with a decisive victory. Trump’s promises of heightened tariffs and corporate tax cuts have fueled expectations of USD strength as the US Dollar Index (DXY) climbs to 105.30. This bullish environment for the USD contrasts with a weaker Euro, which is under strain due to concerns about the impact of Trump’s policies on Eurozone exports and overall growth.
Daily Market Drivers: US Dollar Outshines Weak Euro
The Euro (EUR) has suffered under the pressure of a rising USD, and concerns that Trump’s protectionist policies will impact Europe’s export sector have fueled further depreciation. According to estimates, Trump's tariffs could cut up to 1.5 percentage points from European growth, a potential economic hit of €260 billion. The implications of this economic strain might push the European Central Bank (ECB) towards aggressive monetary easing, possibly with a 50 basis point rate cut as early as December.
Fed Rate Cut Expected Amid Election-Driven Volatility
While Trump’s victory has buoyed the USD, the Federal Reserve’s upcoming decision adds complexity. On Thursday, the Fed is widely expected to implement a second consecutive rate cut of 25 basis points, bringing the target range down to 4.50%-4.75%. Investors will also be closely monitoring Fed Chair Jerome Powell’s press conference for guidance on how Trump’s policies might influence future rate decisions and inflation expectations.
Technical Analysis: EUR/USD Eyes Further Decline
EUR/USD has broken below a key trendline around 1.0750, which may signal further downside. The pair now faces key support at the year-to-date low of 1.0600, while resistance at 1.0800 limits upward moves for now. Technical indicators point to ongoing bearish momentum, with the 50-day EMA declining near 1.0930 and the 14-day Relative Strength Index (RSI) below 40, suggesting additional downward pressure in the near term.
EUR/USD Falls Sharply as Trump Win Drives USD Higher
The EUR/USD pair has plunged, trading at its lowest levels since July, as Republican candidate Donald Trump secured the presidency with a decisive victory. Trump’s promises of heightened tariffs and corporate tax cuts have fueled expectations of USD strength as the US Dollar Index (DXY) climbs to 105.30. This bullish environment for the USD contrasts with a weaker Euro, which is under strain due to concerns about the impact of Trump’s policies on Eurozone exports and overall growth.
Daily Market Drivers: US Dollar Outshines Weak Euro
The Euro (EUR) has suffered under the pressure of a rising USD, and concerns that Trump’s protectionist policies will impact Europe’s export sector have fueled further depreciation. According to estimates, Trump's tariffs could cut up to 1.5 percentage points from European growth, a potential economic hit of €260 billion. The implications of this economic strain might push the European Central Bank (ECB) towards aggressive monetary easing, possibly with a 50 basis point rate cut as early as December.
Fed Rate Cut Expected Amid Election-Driven Volatility
While Trump’s victory has buoyed the USD, the Federal Reserve’s upcoming decision adds complexity. On Thursday, the Fed is widely expected to implement a second consecutive rate cut of 25 basis points, bringing the target range down to 4.50%-4.75%. Investors will also be closely monitoring Fed Chair Jerome Powell’s press conference for guidance on how Trump’s policies might influence future rate decisions and inflation expectations.
Technical Analysis: EUR/USD Eyes Further Decline
EUR/USD has broken below a key trendline around 1.0750, which may signal further downside. The pair now faces key support at the year-to-date low of 1.0600, while resistance at 1.0800 limits upward moves for now. Technical indicators point to ongoing bearish momentum, with the 50-day EMA declining near 1.0930 and the 14-day Relative Strength Index (RSI) below 40, suggesting additional downward pressure in the near term.