Eur/usd rises amid mixed economic signals from US and Germany

EURUSD Analysis

Performance after Thursday
Period	Pct	Chg	Momentum
Thursday	0.35%	40.3 Pips
Week to-date	1.49%	172 Pips
June	3.05%	346 Pips

Upcoming key events (London Time)

Fri 01:30 PM USD PCE Price Index, excluding food and energy (12-mth)
Fri 09:30 PM USD Bank Stress Test Results

What happened lately

The United States saw some mixed economic signals in May 2025 and the first quarter of the year. U.S. Pending Home Sales rose by 1.8% in May after a notable decline of 6.3% in April, suggesting a slight recuperation in the housing market. However, new-home sales in May decreased significantly by 13.7% following a 10.9% increase in April, indicating potential volatility or shifts in homebuyer demand. The job market reflected positive movement with Initial Unemployment Insurance Claims dropping to 236,000 for the week ending June 21, showcasing an improved labor market condition. Manufacturing displayed robust growth as U.S. Durable Goods Orders, particularly those excluding Transportation and Defense, experienced strong increases of 16.4% and 15.5%, respectively, in May. Capital goods orders, excluding aircraft, increased by 1.7%, compared to a negative outlook in the prior month. Inflationary pressures are apparent with the PCE Price Index rising to 3.7% and the GDP Price Index increasing to 3.8% in Q1 2025. Nevertheless, GDP growth contracted at an annualized rate of -0.5% during the same period, marking a decline from the previous quarter.

In contrast, Germany’s consumer sentiment may be dimming as indicated by the GfK Consumer Confidence Survey, which fell slightly to -20.3 points in July from -19.9 in June. This dip points to a less optimistic outlook among German consumers, potentially affecting spending behavior and economic momentum.

The developments in the U.S. and Germany have direct implications for the EUR/USD exchange rate. The rise in U.S. durable goods orders, alongside a decrease in unemployment claims and a stronger PCE Price figure, underscores economic resilience and inflation in the U.S., which could influence Federal Reserve monetary policy towards tightening, supporting the U.S. dollar. Meanwhile, the contraction in U.S. GDP and weak new-home sales alongside softer German consumer confidence adds complexity to the economic narrative. On Thursday, EURUSD rose by 0.35% to 1.16956, likely a reflection of market reactions to these mixed datasets favoring a stronger euro amid uncertainty in the U.S. economic trajectory. Future monetary policy signals, particularly from the upcoming U.S. PCE Price Index and stress test results, will be critical in shaping the direction of EUR/USD in the near term.

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What can we expect from EURUSD today?

EURUSD on Thursday rose 0.35% to 1.16956. Price is above 9-Day EMA while Stochastic is falling in overbought zone.

Updated daily direction for EURUSD looks bullish as the pair ended higher after Thursday trading session.

Looking ahead for the day, immediate upside resistance level is R1 at 1.17423 with break above could target R2 at 1.17891 or figure level area. While towards the downside, we are looking at daily low of 1.16544 as an important support. Break below this level could weaken the current bullish momentum. A break above 1.17451 may suggest continuation after recent positive movement.

For the week to-date, take note that EURUSD is bullish as the pair continued to trade higher and is up by 1.49% over the past few days.

Key levels to watch out:

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