EUR/USD Surges on ECB Hawkish Outlook

The EUR/USD pair has gained ground on Friday, trading around 1.1650 during Asian hours, due to the European Central Bank's (ECB) hawkish monetary policy outlook.

Isabel Schnabel, an ECB Executive Board member, recently emphasized that borrowing costs must continue to rise, citing ongoing conflict in the Middle East and a surprisingly resilient Eurozone economy as major upside risks to inflation.

This hawkish sentiment has shifted market expectations significantly, with the ECB Watch tool now pricing in nearly 96% odds of a deposit rate hike to 2.50% at the upcoming September policy meeting.