Euro Weighed by Dollar Strength and Trade Risks

2026-07-24 09:07 By Joana Ferreira 1 min. read

The euro traded below $1.14, near its one-year low reached in June, as investors assessed the ECB's policy outlook and fresh PMI data, while the dollar stayed supported by Middle East risks and new US tariffs.

The ECB kept interest rates unchanged as expected but signaled that a September rate hike is becoming increasingly likely.

Rising energy prices, with oil nearing $100 per barrel and natural gas prices surging amid the US-Iran conflict, have reinforced inflation concerns and expectations for further tightening after the summer.

Several policymakers, including Bundesbank President Joachim Nagel, also warned that inflation risks remain elevated and further rate increases may be needed.

Meanwhile, the S&P Global survey showed Eurozone business activity returned to growth in July, beating forecasts.

The US also imposed new tariffs on imports from 60 trading partners, including the EU, with the European Commission saying the measures were broadly in line with the EU-US trade agreement.



News Stream
Euro Weighed by Dollar Strength and Trade Risks
The euro traded below $1.14, near its one-year low reached in June, as investors assessed the ECB's policy outlook and fresh PMI data, while the dollar stayed supported by Middle East risks and new US tariffs. The ECB kept interest rates unchanged as expected but signaled that a September rate hike is becoming increasingly likely. Rising energy prices, with oil nearing $100 per barrel and natural gas prices surging amid the US-Iran conflict, have reinforced inflation concerns and expectations for further tightening after the summer. Several policymakers, including Bundesbank President Joachim Nagel, also warned that inflation risks remain elevated and further rate increases may be needed. Meanwhile, the S&P Global survey showed Eurozone business activity returned to growth in July, beating forecasts. The US also imposed new tariffs on imports from 60 trading partners, including the EU, with the European Commission saying the measures were broadly in line with the EU-US trade agreement.
2026-07-24
Euro Under Pressure on ECB Signals, New Tariffs
The euro remained below $1.14, as investors assessed the ECB's policy decision, new US tariffs, and escalating tensions in the Middle East. The ECB left interest rates unchanged as expected but strongly signaled that a September rate hike is increasingly likely. Rising energy prices, with oil nearing $100 per barrel and natural gas surging amid the US-Iran conflict, have reinforced inflation concerns and strengthened expectations that the ECB will resume tightening after the summer, when updated economic forecasts are released. Several ECB policymakers, including Bundesbank President Joachim Nagel, warned that inflation risks remain elevated and that further rate increases may be needed. Meanwhile, the US imposed new tariffs on imports from 60 trading partners, including the EU. The European Commission gave the measures a cautious welcome, saying they are broadly consistent with the tariff commitments agreed under the EU-US Joint Statement.
2026-07-24
Euro Eases After ECB Decision
The euro fell below $1.139 on Thursday after the European Central Bank left its key interest rates unchanged at its July meeting, in line with market expectations. Policymakers maintained a cautious, data-dependent stance, stressing a wait-and-see approach amid heightened uncertainty, particularly around energy prices. After delivering its first rate increase in three years in June, the ECB reiterated that future policy decisions will depend on incoming economic data. Since then, softer inflation, weaker wage growth, slower economic activity and lower inflation expectations have reduced the urgency for further tightening. However, the recent surge in oil prices driven by escalating tensions in the Middle East has renewed concerns that higher energy costs could feed into inflation and delay policy easing. Despite those risks, money markets continue to price in at least two ECB rate cuts by year-end, with the next move fully expected in September.
2026-07-23