The EUR/USD pair remains practically flat on Friday, relatively close to three-week highs hit on the previous day. The US Dollar is a tad firmer, supported by positive US macroeconomic data which provide further reasons for the Federal Reserve (Fed) to keep rates ar high levels for a longer time after next week's meeting, while a poort Business Climate survey from Germany has added weight on the Euro.

The Euro (EUR) is trading around the 1.1750 level at the early European trading session on Friday after pulling back from 1.1790 highs on Thursday, following the ECB's monetary policy decision. The pair, however, remains about 1% higher on the week, relatively close to the multi-year high at 1.1830 hit earlier in July.

The ECB boosted the Euro on Thursday as President Christine Lagarde hinted at a longer interest rate pause. Lagarde stuck to her classical "meeting by meeting" approach on interest rates, but she showed optimism about the growth outlook and stated that inflation risks are strongly anchored, casting doubts about further cuts this year.

Eurozone data released on Friday, however, has failed to provide any significant support to the Euro. The US IFO Business Climate Index improved less than expected in July, with German businesses slightly more positive about the current economic situation, but their sentiment about the near-term outlook has remained flat, against hopes of an improvement.

In the US, business activity beat expectations, led by a significant improvement in the services sector, while the weekly Initial Jobless Claims fell against expectations, giving further reasons to the Fed to wait for more clarity about the impact of US tariffs on inflation and economic growth. The US Dollar extended its recovery after the data.

Source : Fxstreet