The EURUSD pair declined to 1.0384 on Friday. Investors are concerned about the growing risk of trade wars. Discover more in our analysis for 31 January 2025.
The EURUSD rate plunged to 1.0384 on the last day of January. The market looks nervous as yesterday, US President Donald Trump again threatened to impose 25% tariffs on Canada and Mexico. The measure could come into effect as early as Saturday. In this case, the strength of the US dollar is based on the threat of these high trade tariffs and US economic exceptionalism.
The White House does not follow a single line in bilateral trade relations. The state of eternal uncertainty and the inability to calculate real threats are increasing demand for safe-haven assets.
As expected, the ECB lowered the interest rate to 2.90% per annum from the previous 3.15% at the last meeting, marking the fifth rate cut in the current cycle. ECB policymakers left open the possibility of reducing borrowing costs further. This year, markets are pricing in the likelihood of an average 0.7% rate cut.
The EURUSD forecast is very cautious.
On the EURUSD H4 chart, the situation is moderately negative. Sales may extend to the 1.0371 level and continue further to 1.0341.
Things will stabilise if the EURUSD pair returns to 1.0465. However, there are no opportunities for this movement yet.
Although the EURUSD pair is declining, it closes January with 0.34% gains. The EURUSD forecast for today, 31 January 2025 suggests the extension of the selling wave to 1.0371 and then to 1.0341.
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.