Euro to Dollar Tech Forecast: "Rally will Lose Steam Close to 1.15"

June 3, 2025 - Written by Ben Hughes

STORY LINK Euro to Dollar Tech Forecast: "Rally will Lose Steam Close to 1.15"

The Euro to Dollar exchange rate (EUR/USD) was again unable to hold above 1.1450 on Tuesday and dipped back below the 1.1400 level.

The latest US data did not provide the catalyst for further dollar selling, but US confidence remains very fragile.

ING commented; “we don’t see EUR/USD pushing into the 1.15-1.20 range unless we see more material Treasury instability. For now, our baseline expectation is that the rally will lose steam close to 1.15.”

According to Scotiabank; “Near-term support is expected at 1.1350 and near-term resistance is limited ahead of the upper 1.15 area.”

The latest US JOLTS data recorded an increase in job openings to 7.39mn for April from 7.20mn the previous month and above expectations of 7.11mn.

The dollar gained in immediate reaction to the data, but failed to hold the gains.

Trade policy remains an important underlying focus.


Commerzbank commented; “With such erratic US trade policy, where tariffs are only going up, there is a risk that other countries will turn away from the US. In the long term, this is not good news for the US dollar."

ING notes pressure for positive headlines; “Reports suggest China is gaining leverage over the US through its control of chip supply chains and rare earths. Trump and Xi Jinping are set to speak this week, and past direct talks have sometimes eased tensions. That leaves room for a positive surprise that could help the dollar at some point this week.”

Commerzbank expects trade will remain a key market element; “In the long term, it will become increasingly clear that the US administration has no intention of abandoning tariffs. Even if US companies are currently holding back from passing on price increases to consumers due to the constantly changing tariffs, they will not be able to do so forever. Depending on the Fed's reaction at that point, it will be decided whether the US dollar will ultimately benefit from the tariffs."

Bank of America notes that the economy has been resilient and expects the next 2-3 months will be crucial; “If somehow the US economy keeps defying gravity, we would expect investors to start ignoring the policy noise and go back to buying US assets, supporting the USD; US exceptionalism would be back.”

According to the bank; “It is early, but some high frequency indicators have started to raise red flags.”

In this context it added; “If the US economy has a proper landing, we would expect the USD to weaken further to new lows for the year.”

There are still very strong expectations that the ECB will cut interest rates by a further 25 basis points at Thursday’s policy meeting with the deposit rate at 2.00%.


Credit Agricole expects a relatively hawkish stance; “Our house view is for a last 25bp cut in this easing cycle, followed by a long period on hold and the possibility of a rate hike in late 2026.”

It added; “a key observation should be that the EU is already running just above trend growth and this should go higher next year based on Germany’s fiscal expansion & an EU defence spending boost.

Goldman Sachs noted the risk of a sharp downward adjustment to ECB growth projections, but added; “We don’t see these domestic risks yet constituting a major headwind for EUR from here though, and on the whole, the Euro remains one of our preferred vehicles for expressing the Dollar weakness we expect in the months ahead.”

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TAGS: Euro Dollar Forecasts