Fed Uncertainty Cuts Off Euro's Upside Against Dollar

Market uncertainty surrounding the Federal Reserve's monetary policy path is capping the euro's gains against the US dollar, according to ING.

The Dutch banking group notes that while the shared currency has found some support, the market's inability to price in a clear direction for US interest rates is preventing a more sustained move higher for EUR/USD.

This dynamic highlights central bank policy divergence as the primary driver for the pair in the current environment. The market is struggling to find a clear catalyst due to uncertainty about whether the Fed will cut, hold, or hike rates in the coming months.