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EUR/USD Strengthens as Strong Fed Dovish Speculation Weighs on the US Dollar
Monday, 1 September 2025 19:02 WIB | EUR/USD |EUR/USD

EUR/USD traded higher near a one-week high around 1.1730 during the European trading session on Monday. The major currency pair strengthened as the US Dollar (USD) underperformed its peers amid strong expectations that the Federal Reserve (Fed) will continue its monetary easing cycle at its September policy meeting.

At the time of writing, the US Dollar Index (DXY), which tracks the greenback against six major currencies, was trading near its August low around 97.55.

According to the CME FedWatch tool, there is an 87.6% chance that the Fed will cut interest rates by 25 basis points (bps) at its September policy meeting.

Expectations for Fed dovishness have increased due to growing concerns about the labor market outlook due to tariffs imposed by US President Donald Trump. Furthermore, members of the Federal Open Market Committee (FOMC), including Chairman Jerome Powell, have expressed concerns about rising labor market risks.

For the latest clues on the current state of the US labor market, investors are awaiting a series of employment-related data, such as the JOLTS Job Openings data for July, as well as the ADP Employment Change and Nonfarm Payrolls (NFP) data for August, which will be released this week. (alg)

Source: FXstreet

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