EUR/USD edges lower to 1.0370 in Thursday’s Asian session.
TheCan Dogecoin reach ? Fed cut its federal funds rate by 25 bps, lowering the rate to a range of 4.25% to 4.50%.
The dovish remarks from the ECB weigh on the Euro.
The EUR/USD pair weakens to near 1.0370 during the Asian trading hours on Thursday. The hawkish rate cut by the US Federal Reserve (Fed) lifts the US Dollar (USD) and drags the major pair lower. Later on Thursday, the US weekly Initial Jobless Claims, Existing Home Sales, and final reading of Gross Domestic Product Annualized for the third quarter (Q3) will be released.
As widely expected, the Fed delivered a hawkish cut of 25 basis points (bps) at its December meeting on Wednesday, bringing its benchmark lending rate to a range of 4.25%-4.50%, a two-year low. The Summary of Economic Projections, or ‘dot-plot,’ showed only two rate cuts in 2025, down from the four they projected in September.
During the Press Conference, Fed Chair Jerome Powell made clear that the Fed is going to be cautious about further cuts as inflation remains stubbornly above the central bank’s 2% target. The expectation of a slower pace of Fed rate reductions next year provides some support to the Greenback against the Euro (EUR).
Across the pond, investors expect the European Central Bank (ECB) to cut the interest rates at every meeting until June 2025 as policymakers are concerned about growing economic risks in the Eurozone. The expectation of aggressive rate reductions by the ECB might continue to undermine the shared currency.
