The Euro (EUR) Weakened by 0.2% Against the US Dollar (USD), Indicates Market Consolidation

The Euro has shown a modest decline of 0.2% against the US Dollar, underperforming many G10 currencies, which has been noted by Scotiabank's Chief FX Strategist, Shaun Osborne. Osborne suggests that the Euro's current weakness may be a temporary pause following its rally from recent lows. The forex expert indicates a mixed market tone with no obvious thematic drivers influencing this decline. As the week progresses, preliminary PMI data is expected to show a continued contraction in manufacturing and a slowdown in service growth. Additionally, dovish commenting from European Central Bank (ECB) Governing Council member Olli Rehn points to the inflationary headwinds posed by US tariffs. The ongoing sentiment around EUR/USD suggests that it may experience a brief consolidation after its rally in February with near-term support anticipated below 1.14 and resistance expected above 1.1550. Gold prices have pulled back from their recent peaks, signaling some profit-taking as the US Dollar shows signs of recovery amidst easing US-China trade tensions. The performance of GBP/USD has also been lackluster as it retreats to around 1.3350. Conversely, Bitcoin, which had surged past $88,000, is struggling to maintain momentum around the $100,000 milestone, consolidating rather than gaining further traction. This overall performance in currencies and commodities emphasizes a sentiment of cautious optimism driven by geopolitical developments, particularly in US-China trade. Investors are reminded to consider the inherent risks in foreign exchange trading, as considerable leverage can lead to rapid losses, as stated in various market warnings. The overall market has been shaken by recent developments surrounding US President Trump’s comments regarding the Federal Reserve's independence, leading to increasing market volatility and uncertainty about future monetary policy.