In Europe, the euro continues to benefit from the growing belief that the ECB has completed its rate-cutting cycle. While traders remain cautious ahead of Thursday’s ECB meeting, most economists expect interest rates to remain unchanged, as inflation is largely under control and economic conditions remain stable. Looking ahead, many analysts believe the ECB could begin raising rates in the third quarter of next year, although some warn that risks such as potential US tariffs could still force earlier cuts.

Overall market expectations also favor the euro over the US dollar. Major institutions such as Goldman Sachs and Deutsche Bank argue that conditions are in place for a renewed decline in the US dollar. While several central banks—including the Bank of Japan, the Bank of England, the Reserve Bank of Australia, and the People’s Bank of China—are expected to lean toward tighter policy, the Federal Reserve is likely to maintain a more cautious stance. The Fed has already restarted quantitative easing and may implement at least one more rate cut this year, despite internal disagreements among policymakers.

From a technical perspective, the euro–US dollar pair remains in a clear uptrend. The pair has risen steadily from a November low of 1.1463 to around 1.1740 and has formed an inverse head-and-shoulders pattern, which is a well-known bullish signal.

Both fundamental and technical factors suggest that the euro–US dollar pair could continue to rise in the short to medium term. If bullish momentum holds, the next key resistance is located at 1.1913, the highest level recorded this year and the highest since September 2021. A move above this area could open the door to the psychological 1.2000 level. From an investment perspective, long-term investors may consider maintaining a bullish bias while closely monitoring upcoming central bank decisions and US labor market data for confirmation.