"Market focus is firmly on the European Central Bank's meeting on Thursday, where policymakers are widely expected to keep interest rates unchanged, a stance that could continue to underpin the single currency. The euro could also find support from stronger economic data. Euro area industrial production posted a 0.8% month-on-month rise in October, while Germany's wholesale prices accelerated to 1.5% year-on-year in November, the strongest reading since February."
"The euro was broadly stable at the start of the week against most major currencies, as traders could remain cautious ahead of a dense calendar of central bank decisions and economic data. Together with firmer growth in the third quarter and inflation proving stickier than previously anticipated, the data support the case for a cautious stance on rates. Against this backdrop, expectations could continue to shift toward a rate hike later in 2026, which could support the currency."
Euro was broadly stable against most major currencies as traders remained cautious ahead of a calendar of central bank decisions and economic data. The European Central Bank is widely expected to keep interest rates unchanged, which could underpin the currency. Stronger data — euro area industrial production up 0.8% month-on-month in October and Germany's wholesale prices accelerating to 1.5% year-on-year in November — alongside firmer third-quarter growth and stickier inflation support a cautious policy stance and shift expectations toward a rate hike later in 2026, keeping government bond yields near multi-year highs. Divergent central bank paths could favour the euro versus sterling and the dollar, while the yen may resist.
Read at London Business News | Londonlovesbusiness.com
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