EURUSD extends its decline on Friday, hovering around the mid-1.0600s.

During the early European session on Friday, the EURUSD pair remains under selling pressure. And trades in negative territory for the fourth consecutive day. The major currency is presently trading in 1.0653, down 0.06% on the day.

Inflation above 2% is expensive to the economy, according to European Central Bank policymakers, and the ECB intends to contain it.

According to Phillip Lane, Chief Economist of the European Central Bank (ECB). Inflation above 2% is expensive to the economy. and that central banks try to keep inflation under control in the medium run. On Thursday, German Bundesbank President Joachim Nagel claimed. That the eurozone’s inflation rate is not reaching 2% at the anticipated rate. And that core inflation is stubbornly high and would only reduce gradually.

According to analysts polled by Reuters, the ECB will complete its rate hike cycle. And remain on hold until at least July of next year. It’s worth noting that the European Central Bank hiked its main interest rate to a record high of 4%. On September 14. As a result, the Euro may fall versus the US dollar.

Interest rates in the United States are expected to climb once more this year.

On Wednesday’s meeting, the Fed chose to keep interest rates steady in the 5.25-5.50% range, as generally expected. In the market, it is expected. According to the Fed’s most recent quarterly forecasts, the benchmark overnight interest rate may be raised one more time this year to a high range of 5.50% to 5.75%, and rates may remain much tighter through 2024 than previously projected. This, in turn, strengthens the US dollar and acts as a headwind for the EURUSD pair.

In terms of Thursday’s report, the US weekly initial jobless claims fell to 201,000, the lowest level since January. Meanwhile, the Philadelphia Fed fell to -13.5 in September from 12.0 in the previous reading, falling short of the market’s forecast of -0.7. Existing Home Sales decreased to 4.04 million MoM in August, down from 4.07 million the prior month.

EURUSD participants are looking forward to the Eurozone and US Purchasing Manager Index (PMI) statistics.

In the near future, the Purchasing Managers Index (PMI) will be published. This Friday’s agenda includes both the Eurozone and the United States. In September, the preliminary Eurozone Composite PMI is predicted to fall from 46.7 to 46.5, while the preliminary US PMI is expected to improve marginally. Traders will use these numbers to identify trading opportunities in the EURUSD pair.