The EUR/USD is starting the month of September slightly above the 1.17100 level as of this morning. Although the currency pair achieved upwards mobility it didn’t come without a fight for traders.
As September starts the EUR/USD is now perched above the 1.17100 ratio in early Forex today. The past month of trading certainly saw upwards momentum for the EUR/USD accomplished. However, after the immediate climb on the 1st of August via a reaction from the weaker than anticipated U.S jobs numbers and reestablishment of 1.16000 as a sustained level, traders have had to confront a rather consistent dogfight the past few weeks while speculating.
The U.S is celebrating Labor Day and EUR/USD need to know that today’s immediate results should be looked at suspiciously. Coming up on Friday are the U.S Non-Farm Employment Change numbers. On the 17th of September the Federal Reserve is likely to cut its interest rate by 25 basis points. However, it is what the Fed FOMC Statement reveals on that day which will cause another firestorm for the EUR/USD.
EUR/USD Caution Hit by a Flamethrower
On the 22nd off August the EUR/USD was essentially trading where it had traversed on the 6th of August around a value of 1.16150. Between the 6th and 22nd the EUR/USD had found rather solid support near the 1.16050 vicinity – with a couple of outliers lower - and had tested highs slightly above 1.17300. When Fed Chairman Jerome Powell on the 22nd of August in Jackson Hole made a speech that the Fed was likely to cut interest rates in September the EUR/USD leapt to nearly 1.17480 that Friday.
Since then the EUR/USD turned somewhat cautious again and actually fell to 1.15750 on Wednesday of last week. Then the U.S released GDP numbers which came in stronger than expected with growth statistics and showed inflation had remained relatively tame via the GDP Price Index. It should be noted that in the middle of August that Germany turned in lackluster economic data too.
Financial Institutions Outlooks Remain Positive but Unsure
The USD/EUR climbed again late last week as financial institutions seemed to bet on the potential of a more dovish U.S Federal Reserve. However, there is still an obvious hint of caution which has been causing headwinds against attempts to create over confident bullishness in the EUR/USD.
- The ability of the EUR/USD to climb above 1.17100 early this morning shows that financial institutions in Europe likely are leaning into a slightly weaker USD mid-term.
- But the constant fear that U.S inflation is going to start buzzing stronger again because of tariff implications is certainly causing unease.
- The EUR/USD may find buyers who want to pursue higher values early this week, but U.S jobs numbers this Friday will be important.
- If U.S jobs numbers are weaker than expected, this might fuel buying of the EUR/USD.
- However, it should be remembered large institutions have likely positioned already for September’s rate cut from the U.S Fed, so if jobs numbers meet expectations the EUR/USD could see some selling.
- The Fed’s FOMC policy statement on the 17th will hold the key for the EUR/USD and produce impetus. Will the Fed suggest another cut in October is possible?
EUR/USD Outlook for September 2025:
Speculative price range for EUR/USD is 1.15900 to 1.18500
After a turbulent month of August which saw an immediate run higher, the EUR/USD saw a well defined price realm which tested day traders. September storms are likely in Forex too, the EUR/USD like all other major currency pairs this year’s has seen a constant battle and trends have been hard to capture because of rather fast intraday results for day traders. However, the trend higher over the long haul continues to see persistence challenges banging up against resistance.
The question is if the EUR/USD will break through the 1.17300 realm and start to produce highs seen in July when the 1.18000 ratio was penetrated. Financial institutions clearly believed the Fed would have to be move dovish early in the summer, but those hopes faded. Now once again, there are signs that the Federal Reserve will lower their interest rates, but until the Fed meeting on the 17th of September offers a confirmation or denial, all trading in the EUR/USD is likely to remain a test of outlook that remains unclear. Speculators need to remain careful. A Fed interest rate cut for October may prove difficult for Jerome Powell to promise in the middle of September.
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