The Euro has extended its decline against the US Dollar, trading near 1.1047 in Friday’s European session. The currency pair’s outlook remains uncertain as expectations of further interest rate hikes by the Federal Reserve continue to support the US Dollar. TD Securities now anticipates rate increases in December, January, and March, up from its previous forecast of hikes in December and March only. The firm’s strategists warn that the Fed could tighten policy further if inflation remains strong or the labor market accelerates, but a pause is possible if uncertainty impacts the labor market or equities experience a rapid sell-off.
Investors are focusing on the October US Producer Price Index (PPI) release, expected to show a monthly increase of 0.4%, down from 1.3% in September. Core PPI, which excludes volatile food and energy items, is forecast to rise by 0.3%, compared with the previous reading of 0.7%. Meanwhile, the Eurozone’s revised Q3 Gross Domestic Product (GDP) estimate is due at 10:00 GMT, with growth expected to remain at 0.4%, matching the preliminary Q3 figures.
Technically, EUR/USD maintains a bearish bias, trading well below its 20-day exponential moving average (EMA) of 1.1170. The pair’s failure to regain this level suggests continued downward pressure, with no nearby structural support levels identified. A daily close above the 20-day EMA would be needed to temper the bearish tone and create scope for a wider corrective rebound.