EURUSD under Fed pressure as US inflation risks reshape market expectations

The euro continues to lose ground amid a stronger USD. The current price is 1.1385. Find out more in our analysis for 24 September 2026.

EURUSD forecast: key takeaways

• The eurozone composite PMI rose to 53.1 in September from 52.0 previously
• Eurozone inflation exceeded 3%
• EURUSD forecast for 24 September 2026: 1.1415 and 1.1320

Fundamental analysis

The EURUSD forecast takes into account that the fundamental backdrop for EURUSD has shifted noticeably in favour of the dollar: strong US data have once again strengthened expectations of further Federal Reserve monetary-policy tightening, while the prospects of additional ECB rate hikes remain less certain. After a sharp decline, the pair is correcting and testing the 1.1385 level.

The latest manufacturing indicator came in better than expected, heightening inflation concerns and once again increasing the probability of further Federal Reserve rate hikes. At the same time, a weak auction of five-year Treasuries pushed yields higher.

The eurozone composite PMI rose to 53.1 in September from 52.0 previously, reaching its highest level in more than three years. This reduces concerns about a sharp slowdown in the region's economy and provides fundamental support for the euro.

Eurozone inflation exceeded 3.0%, while higher energy prices create a risk of further acceleration. At the same time, ECB Chief Economist Philip Lane noted the absence of significant second-round effects through wages. This reduces the probability of an aggressive rate-hike cycle.

Strong US data, rising Treasury yields, and the likelihood of further Federal Reserve rate hikes are supporting the dollar. The euro is being supported by the resilience of the eurozone economy and high inflation, but uncertainty over the ECB's next steps limits this support.

The fundamental analysis for 24 September 2026 takes into account that further strengthening of inflation signals from the US would support the dollar, while sustained eurozone growth and new hawkish signals from the ECB could partially restore the euro's position.

Technical outlook

On the H4 chart, EURUSD formed an Inverted Hammer reversal pattern near the lower Bollinger Band. At this stage, the pair could continue its corrective wave as the pattern signal plays out, with resistance around 1.1415 serving as the correction target. A rebound from this level would open the way for the downtrend to resume.

At the same time, today's EURUSD forecast also allows for another scenario. The pair could continue to decline and test support around 1.1320 without first testing the resistance level.

EURUSD overview

• Asset: EURUSD
• Timeframe: H4 (Intraday)
• Trend: bearish
• Key resistance levels: 1.1415 and 1.1489
• Key support levels: 1.1374 and 1.1320

EURUSD trading scenario for today

Trading scenario (Sell Stop)

Consolidation below the 1.1374 support level would confirm the continuation of the downtrend and create conditions for opening short positions.

• Current price: 1.1385
• Entry level: 1.1374
• Take Profit: 1.1320
• Stop Loss: 1.1394
• Risk-to-reward ratio: above 1:2

The trade idea is valid until 08:00 AM on 25 September 2026 (server time, UTC+3).

Risk factors

The main risk to the bearish EURUSD scenario would be a further easing of inflationary pressure in the US amid falling oil prices. This could reduce expectations of further Federal Reserve rate hikes and weaken the dollar. An additional factor could be an interest rate increase by the ECB.

Summary

The prospect of another Federal Reserve interest rate hike is putting additional pressure on the euro. At the same time, EURUSD technical analysis suggests a correction towards the 1.1415 level before the decline resumes.

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