EUR/USD trims gains after soft Eurozone industrial production figures

EUR/USD retreated from two-week highs right above 1.1630 but remains positive on daily charts, trading at 1.1615 at the time of writing. Lower-than-expected Eurozone Industrial figures have hurt the common currency, but the risk appetite following the reopening of the US federal government is keeping the pair buoyed so far.

Industrial Production increased at a 0.2% rate in the Eurozone in September, following an upwardly revised 1.1% decline in August, while year-on-year, factory activity remained expanding at a steady 1.2% pace. These figures undershoot the market expectations of a 0.7% monthly growth and a 2.1% yearly growth improvement, and have capped the Euro’s recovery.

The market sentiment, however, remains positive after the US President Donald Trump signed the bill that ended a 43-day-long US government shutdown. This will allow for the release of a backlog of US macroeconomic figures, although the White House has warned that October’s employment and inflation figures might never see the light.

On Wednesday, Federal Reserve (Fed) officials continued to show their divergences, with Governor Stephen Miran reiterating the need for further interest rate cuts, while Atlanta Fed President Raphael Bostic showed a more cautious view, playing down the labour market’s weakness and highlighting the upside risks to inflation.

The highlight today would be the US Consumer Price Index (CPI), but it is unlikely to be released. In that sense, some Fed speakers and the Monthly Budget Statement may provide some guidance for US Dollar (USD) crosses.

Euro Price Today

The table below shows the percentage change of Euro (EUR) against listed major currencies today. Euro was the strongest against the Japanese Yen.

	USD	EUR	GBP	JPY	CAD	AUD	NZD	CHF
USD		-0.13%	-0.08%	0.02%	-0.02%	-0.51%	-0.03%	-0.15%
EUR	0.13%		0.05%	0.16%	0.11%	-0.37%	0.11%	-0.01%
GBP	0.08%	-0.05%		0.10%	0.06%	-0.42%	0.06%	-0.06%
JPY	-0.02%	-0.16%	-0.10%		-0.05%	-0.53%	-0.08%	-0.17%
CAD	0.02%	-0.11%	-0.06%	0.05%		-0.47%	-0.02%	-0.12%
AUD	0.51%	0.37%	0.42%	0.53%	0.47%		0.48%	0.36%
NZD	0.03%	-0.11%	-0.06%	0.08%	0.02%	-0.48%		-0.12%
CHF	0.15%	0.01%	0.06%	0.17%	0.12%	-0.36%	0.12%

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent EUR (base)/USD (quote).

Daily digest market movers: The US Dollar dips as the US shutdown ends

The US Dollar is trading lower across the board with investors celebrating the end of the longest US government shutdown in history.
Private data released recently revealed a stalled labor market, but the odds for further Fed monetary easing this year remain evenly split. The CME Group’s Fed Watch tool shows that bets for a quarter-point rate cut in December have eased to 54%, from 67% last week and about 95% one month ago.
On Wednesday, Fed Governor Stephen Miran reiterated that the current monetary policy is too restrictive and that is partly responsible for the labour market weakness that the central bank is tasked with avoiding.
On the other side of the spectrum, Atlanta Fed President Raphael Bostic assessed that the labor market is in a “curious state of balance,” while, according to his view, lowering interest rates further might feed the inflation beast, leading to serious trouble.
Bostic also announced that he will retire at the end of his term in February 2026, which is likely to give US President Trump the chance to replace him with another partisan dove to push for a more accommodative monetary policy.
On Wednesday, German inflation data confirmed that the Harmonized Index of Consumer Prices (HICP) grew at a 0.3% pace in October and at 2.3% in the last 12 months, slightly below the 2.4% yearly inflation seen in September. Likewise, the German CPI accelerated to 0.3% in October from 0.2% in September, although the yearly rate eased to 2.3% from the previous month’s 2.4% reading.

Technical Analysis: EUR/USD is eroding the top of the bearish channel

,EUR/USD has pierced the top of a descending channel from early October highs. The 4-hour Relative Strength Index (RSI) consolidates within bullish territory nearing overbought conditions after a seven-day rally, but the Moving Average Convergence Divergence (MACD) is about to cross below the signal line, which suggests that upside momentum might be fading.

Bulls should remain above a previous support in the area of 1.1620-1.1625 (October 28 low), and the channel top, currently around 1.1615, to confirm a trend shift, aiming for the October 28 and 29 highs near 1.1670, and the October 17 high, near 1.1730.

On the other side, downside attempts are being contained above Wednesday’s lows of 1.1565 for now. Below, the pair might find support at the 1.1530-1.1540 area (near November 7 and 10 lows) ahead of the 1.1500 psychological level and the key support at the November 5 low around 1.1470.

Economic Indicator

Industrial Production s.a. (MoM)

The Industrial Production index, released by Eurostat on a monthly basis, measures changes in the price-adjusted output of industry. It is a widely-followed indicator to gauge the strength in the Eurozone’s manufacturing sector. Generally, a high reading is seen as bullish for the Euro (EUR), while a low reading is seen as bearish.

Economic Indicator

Industrial Production w.d.a. (YoY)

The Industrial Production is released by the Eurostat. It shows the volume of production of Industries such as factories and manufacturing. Up trend is regarded as inflationary which may anticipate interest rates to rise. Usually, if high industrial production growth comes out, this may generate a positive sentiment (or bullish) for the EUR, while low industrial production is seen as a negative sentiment (or bearish).