EUR/USD strengthens above 1.1500 as Fed rate cut bets grow

  • November 24, 2025
  • Posted by: EWGFX
  • Category: news
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EUR/USD gains ground to around 1.1525 in Monday’s early European session.
Fed’s Williams said he sees room for ‘further adjustment’ to rates.
The ECB’s cautious tone underpins the Euro against the US Dollar.

The EUR/USD pair trades in positive territory around 1.1525 during the early European trading hours on Monday. The US Dollar (USD) edges lower against the Euro (EUR) as Federal Reserve (Fed) rate cut expectations rise. Traders brace for the release of the US September Producer Price Index (PPI) and Retail Sales later on Tuesday.

Traders raise their bets on a Fed rate cut in December following dovish comments from New York Fed President John Williams, weighing on the Greenback. Williams said on Friday that he expects the US central bank to lower its key interest rate from here as labor market weakness poses a bigger threat than higher inflation. The probability of a Fed rate cut next month surged to 70% on Monday after falling to 40% in the previous week, according to the CME FedWatch Tool.

Meanwhile, several Fed officials delivered cautious comments, including Boston Fed President Susan Collins and Dallas Fed President Lorie Logan. Susan Collins said that she would have a “high bar” for supporting further rate cuts, while Lorie Logan noted, “In the absence of clear evidence that justifies further easing, holding rates steady for a time would allow the FOMC to better assess the degree of restriction from current policy.

The European Central Bank (ECB) is widely expected to leave interest rates unchanged through at least the end of 2025 and into 2026, after keeping its key interest rates steady at its October meeting. A Reuters poll of economists in November confirmed this expectation, citing a stable economic outlook and contained inflation.

ECB President Christine Lagarde said on Friday that the central bank will remain vigilant to inflation risks and will adjust interest rates, if needed, to keep inflation at 2% target. The cautious stance from the ECB could provide some support to the EUR against the JPY in the near term.