EURUSD on Friday dropped -0.39% to 1.08120. Week ending 2025-03-21 moved lower by -0.59%. What happened.

EURUSD Analysis

Performance
Period	Pct	Chg	Momentum
Friday	-0.39%	-41.9 Pips
Week 2025-03-21	-0.59%	-64.5 Pips
March	4.22%	437.3 Pips

Upcoming key events for the new week (London Time)

Thu 12:30 PM GDP annual rate
Fri 12:30 PM PCE Price Index, excluding food and energy (12-mth)

What happened over the week

The Euro Area experienced a decrease in consumer confidence, as indicated by the Euro Area Consumer Confidence Indicator, which dropped to -14.5 points in March from -13.6 points in February according to DG ECFIN. Additionally, inflationary pressures in the Euro Area showed signs of moderation, with the Harmonized Index of Consumer Prices (HICP) for one month in February decreasing to 0.4% from 0.5% in January, and the Core Harmonized Index of Consumer Prices also decreased to 0.5% from 0.6%. However, the annual core HICP remained stable at 2.6% according to Eurostat.

In the United States, the Department of Labor reported a slight increase in Initial Unemployment Insurance Claims to 223K in the week ending 15 March, up from the previous 221K. There was a notable decline in the U.S. Manufacturing Business Outlook Survey to 12.5 points in March from 18.1 points in February as per the Philadelphia Fed. Interest rate projections from the Federal Reserve showed decreases across different periods, with the 1st year projection dropping to 3.4% from 3.9%, the 2nd year to 3.1% from 3.4%, and another projection drop to 3.9% from 4.4%. The longer-term projection remained stable at 3%, and the Federal Funds Rate was unchanged at 4.5%.

Germany’s economic indicators presented mixed outcomes. While the Producer Price Index (PPI) for one month in February saw a slight deflation of -0.2% from the previous month’s -0.1%, the annual Producer Prices Index increased to 0.7% from January’s 0.5%, indicating some inflationary pressures as reported by Destatis.

Regarding EURUSD, the data released during this week contributed to a bearish sentiment. The decline in Euro Area consumer confidence and subdued inflation data suggests weaker economic conditions in the Eurozone, which tends to weigh negatively on the euro. Concurrently, the U.S. faced higher unemployment claims and a slowdown in manufacturing, which reduces USD appeal but was partly offset by unchanged interest rates maintaining USD’s relatively higher yield against the euro. This dynamic likely contributed to the EURUSD dropping by 0.39% to 1.08120 on Friday, and a weekly decline of 0.59%, after hitting a 23-week high. Upcoming U.S. economic data with high impact could further influence the EURUSD pair, particularly the GDP annual rate and PCE Price Index figures, which may provide additional insights into economic conditions and potential policy responses.

From X (Twitter)

Euro area annual #inflation down to 2.3% in February 2025 https://t.co/uHitcUIupZ pic.twitter.com/CjAkFnbbMP

— EU_Eurostat (@EU_Eurostat) March 19, 2025

Read Chair Powell's full opening statement from the #FOMC press conference (PDF):  https://t.co/tYevX9qhem pic.twitter.com/cdh3KhnLuf

— Federal Reserve (@federalreserve) March 19, 2025

What can we expect from EURUSD for the new week and what happened on Friday?

EURUSD on Friday dropped -0.39% to 1.08. Price is below 9-Day EMA while Stochastic is falling. For the week ending 2025-03-21, the pair dropped -0.59% or -64.5 pips lower.

Looking ahead, EURUSD looks bearish as the pair posted lower in Friday trading session.

For the new week, our technical outlook is mixed. To see upside interest, we prefer to look at price breakout of week high of 1.10 or at least consolidates above Weekly Pivot level of 1.09. On the downside, we are looking at week low 1.08 or 1.08 (WS1) as immediate support level. EURUSD need to break on either side to indicate a short-term bias. A close below week low of 1.08 would indicate selling pressure.

For the month of March, EURUSD is up by 4.22% or 437.3 pips higher.

Weekly key levels to watch out:

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