Euro Faces Selling Pressure as Hawkish Fed Rhetoric Boosts Dollar
The Euro is facing selling pressure against the US Dollar in early European trading on Friday. The EUR/USD pair hovers around 1.1375, staying within Thursday's range but continuing to face downward momentum as the Greenback gains strength across major currencies.
The US Dollar Index (DXY) has reached an eight-week high of 101.40, fueled by hawkish rhetoric from Federal Reserve officials. Strategists at Brown Brothers Harriman note that the USD is 'powering forward against most major currencies,' supported by a Fed that remains firmly hawkish and a widening gap in US economic growth relative to other major economies.
Fed Governor Michael Barr warned that 'further policy adjustments are likely to be needed to ensure inflation comes down to target in a timely fashion.' New York Fed President John Williams also emphasized the resilience of the US economy, but highlighted inflation as the 'big challenge,' suggesting another rate hike may be necessary by year's end.
The EUR/USD technical picture remains bearish, with the pair trading below the 20-day EMA at 1.1501. Immediate support is seen near 1.1350, which could open the door to a new leg lower for the pair if broken.