Euro to Dollar Forecast: EUR/USD Above 1.16 Ahead of US Jobs Risk

Published: Thursday, 4 September 2025 21:30 BST - Written by David Woodsmith

STORY LINK Euro to Dollar Forecast: EUR/USD Above 1.16 Ahead of US Jobs Risk

The near-term Euro to Dollar (EUR/USD) outlook remains range-bound, with the pair trading above 1.1600 but unable to break 1.1700 as traders brace for Friday’s US jobs report. Analysts at Scotiabank highlight resistance near 1.1720, while Fed rate cut bets keep the dollar’s forecast under pressure.

EUR/USD Forecasts: Held Below 1.1700

The Euro to Dollar (EUR/USD) exchange rate has held above 1.1600 without being able to challenge the 1.1700 level and settling in the middle of this range.

There was weak labour-market data which reinforced expectations of Fed rate cuts, but he dollar managed to avoid further selling pressure in global markets.

Markets are now pricing in close to a 100% probability of a cut at the September meeting.

According to Scotiabank; “we continue to highlight the importance of descending resistance around 1.1720. We look to a near-term range bound between 1.1600 support and 1.1720 resistance.”

Markets remained focus on the US labour-market data.

ADP data recorded an increase in private payrolls of 54,000 for August compared with expectations of around 75,000 and following a revised 106,000 gain the previous month.

ADP chief economist Dr. Nela Richardson commented; "The year started with strong job growth, but that momentum has been whipsawed by uncertainty. A variety of things could explain the hiring slowdown, including labor shortages, skittish consumers, and AI disruptions."

Initial jobless claims increased to 237,000 in the latest week from 229,000 previously, although continuing claims were held at 1.94mn.

The overall evidence has continued to suggest a weaker labour market.

According to MUFG; “the release of the Fed’s latest Beige Book for August pointed to weak consumer spending and slower growth. Firms indicated that they were reluctant to hire new workers given weak demand and elevated uncertainty. It continues to suggest that there is a higher hurdle for the Fed not to resume rate cuts this month.”

It added; “Tomorrow’s NFP report would have to be significantly stronger than expected to push back Fed rate cut expectations and lift the US dollar.”

Consensus forecasts are for an increase in non-farm payrolls of around 75,000 for August, little changed from 73,000 previously with the unemployment rate ticking higher to 4.3% from 4.2%.

Revisions will be watched very closely after the huge revisions large month. The data will also be under very close scrutiny after the BLS head was fired last month following the weaker than expected data.

ING added; “the dollar appears expensive relative to its short-term rates, and we believe it has more room to fall into tomorrow’s jobs report.”

There were no major Euro-zone data releases during the day with markets looking ahead to the French confidence vote planned on September 8th.

Scotiabank commented; “President Macron is rumoured to be seeking a path forward in which France can avoid new elections, which seems to be reassuring markets as French yields tumble and spreads (vs. Germany) narrow.”

It added; “The outlook for relative central bank policy remains supportive for the EUR, and a shift in focus back toward fundamentals would likely offer it a significant near-term boost.”

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TAGS: Euro Dollar Forecasts