Euro USD exchange rate near 1.14: what's next after FOMC?
The euro usd exchange rate is consolidating near the key 1.14 resistance after the Federal Reserve held rates at 3.50%–3.75% with three hawkish dissenters. EUR/USD traded around 1.1465 early Thursday as traders await Eurozone and German Q2 GDP, while technical sellers still defend the 1.14 zone ahead of Friday’s Flash CPI.
Key Takeaways
- The Fed kept the policy rate unchanged at 3.50%–3.75%, but Logan, Hammack, and Kashkari dissented for a 25 bps hike.
- EUR/USD traded with mild losses near 1.1465 in early Asian trade Thursday after the hawkish hold.
- The pair had been consolidating at the key 1.14 resistance, where a major downward trendline also sits.
- Next catalysts include Eurozone and German Q2 GDP on Thursday and Eurozone Flash CPI on Friday.
- Markets were pricing a 65% chance of an ECB September hike before the week’s data slate.
What happened to the euro usd exchange rate after the FOMC decision?
Ahead of the meeting, investingLive noted EUR/USD consolidating at the key 1.14 resistance as the dollar traded sideways into the FOMC decision.
The Fed then left rates unchanged in the 3.50%–3.75% range, matching the widely expected hold. Dallas Fed President Lorie Logan, Cleveland’s Beth Hammack, and Minneapolis Fed chief Neel Kashkari dissented in favor of raising rates by 25 basis points.
According to FXStreet, EUR/USD edged lower to near 1.1450–1.1465 in early Asian trade Thursday as the dollar firmed on that hawkish hold. Fed Chair Kevin Warsh said the Fed will not offer policy hints but will take the steps needed to meet its 2% inflation target.
Why does the 1.14 level still matter for EUR/USD?
On the daily chart, EUR/USD was trading below the key 1.14 zone, which aligns with a major downward trendline. investingLive described that area as strong technical resistance where sellers can define risk above the trendline and target the 1.10 handle.
Buyers, by contrast, need a break above the trendline to open a path toward the 1.16 handle. On shorter timeframes, the near-term direction was expected to hinge on the FOMC outcome, with a hawkish surprise pointing to a selloff toward monthly lows and a dovish surprise toward an upside break near 1.1482.
Separately, an FX Empire technical note carried on Yahoo Finance UK had earlier flagged EUR/USD slipping to 1.1362 and testing the bottom of a recent consolidation area, underscoring how contested the pair’s range has been into the Fed week.
What is next for the euro usd exchange rate this week?
Traders are now bracing for preliminary Q2 GDP readings from Germany and the Eurozone. Economists estimate Eurozone GDP at a modest 0.2% quarter-on-quarter after a 0.2% contraction previously, while German GDP is projected at 0.1% QoQ versus 0.3% prior. Stronger-than-expected outcomes could lift the euro near term.
Also on the slate are the US PCE price index, US Advance Q2 GDP, and jobless claims, followed Friday by Eurozone Flash CPI and the US Q2 Employment Cost Index. On the euro side, the ECB left rates unchanged at its last meeting but signaled via post-meeting commentary that it is ready to hike in September if the inflation outlook deteriorates.
Markets had been pricing a 65% chance of a September ECB hike and about 37 bps of tightening by year-end. ECB policymaker Peter Kazimir said the bank will need to raise rates at least once more, and financial markets see at least two more ECB hikes, with the first fully priced by October and the second by March.
Geopolitical risk remains a cross-current: investingLive cited a surprise Iranian attack on US forces that was intercepted, raising the risk of prolonged conflict and higher energy prices. For more FX and policy alerts, follow BlasterPost’s Fintech & Crypto Alerts hub.