The EURUSD pair attempted a mild rebound in Thursday’s early European session after better-than-expected Eurozone PMIs lifted sentiment. The pair briefly climbed above 1.1650 before losing steam, slipping back into a tight range near the weekly lows of 1.1625 as markets shift their focus to key US macroeconomic data.
Eurozone PMIs Bring Temporary Relief
The latest Eurozone Manufacturing PMI data surprised to the upside, rising to 50.5 in August from 49.8 in July, signaling a modest return to growth after months of contraction.
German PMI: The manufacturing index improved sharply to 49.9, beating expectations of 48.8, while the services gauge slowed slightly to 50.1.
French PMI: Also showed mild improvements, offering additional support to the single currency.
While these readings eased some immediate downside pressure on the Euro, the overall impact was limited as the US Dollar maintained a firm tone across markets.
US Data in Focus: PMI and Jobless Claims
Attention now shifts to the US S&P Global PMI and weekly jobless claims scheduled for release later today.
PMI Forecasts: Services activity is expected to cool to 54.2 in August from 55.7, while manufacturing could edge lower to 49.5 from 49.8.
Jobless Claims: Weekly claims are projected to rise modestly, reinforcing signals of a gradual cooling in the labor market.
Weaker-than-expected data could weigh on the USD, potentially giving EURUSD room to retest 1.1700, while stronger figures might deepen the pair’s downside pressure.
Jackson Hole: Powell Speech Looms Large
Markets remain cautious ahead of Fed Chair Jerome Powell’s speech at the Jackson Hole symposium on Friday. Investors are looking for clues on whether the central bank might accelerate its rate-cut path in the coming months.
Current pricing shows over 80% odds of a September quarter-point cut, though Powell’s tone could sway expectations further.
A hawkish stance could reinforce the USD’s strength, while a dovish tilt may spark a short-term rebound in EURUSD.
Political Pressure on the Fed Adds Drama
Adding a political layer to the Fed narrative, former President Donald Trump has renewed his attacks on the central bank, calling for the resignation of Governor Lisa Cook. This move is widely viewed as an attempt to push for a more accommodative monetary policy ahead of the 2026 election cycle.
EURUSD Technical Outlook: Key Levels to Watch
Immediate Support: 1.1625 – the session low and a key weekly floor.
Key Resistance: 1.1700 – a psychological and technical barrier.
Bias: Sideways to slightly bearish unless US data disappoints or Powell strikes a dovish note.
Technical indicators suggest a neutral-to-bearish tone, with traders awaiting confirmation from US macro events to establish a clearer trend direction.
Conclusion: Rangebound Sentiment Across FX Markets
Broader currency markets are also trading in narrow ranges ahead of Powell’s speech. While the USD maintains its defensive strength, rallies remain capped by rate-cut expectations.
The Euro is slightly stronger against the Japanese Yen, but mixed performance against other majors reflects uncertainty and low conviction among traders.
Key Takeaways
EURUSD remains trapped near the lower end of its weekly range as the USD stays firm.
Eurozone PMI data provided only temporary support amid broader dollar strength.
US PMI and jobless claims later today could inject short-term volatility.
Powell’s Jackson Hole speech is the week’s defining event, likely shaping USD trends into September.
