EURUSD Edges Higher Amid Middle East Calm and Slowing Fed Rate Hike Bets

The EURUSD pair saw a modest recovery on July 27, 2026, as Brent crude prices dropped over 6% to around $90 a barrel due to a pause in hostilities between the US and Iran.

This easing of geopolitical tensions reduced demand for the safe-haven US dollar, allowing the euro to edge higher to 1.1389.

The Eurozone's composite Purchasing Managers' Index (PMI) rose to 51.9 in July, exceeding market expectations and signaling expansion in business activity for the first time in four months.

However, with the Federal Reserve's two-day FOMC meeting on July 28-29 looming large, markets are pricing in a one-in-three chance of a rate hike that could reverse the euro's gains.