⚡ Euro softens to near 1.1350 as Fed hike bets rise ahead of PCE inflation data

**BREAKING: Euro Falls to Five-Month Low Against Dollar on Rising Fed Rate Hike Expectations**

The euro slumped to approximately 1.1355 against the US dollar during early Asian trading Thursday, marking its weakest level since June 2025. The sharp decline reflects growing trader conviction that the Federal Reserve will raise interest rates later this year, strengthening dollar demand across global markets.

The EUR/USD pair’s slide comes as market participants position ahead of critical US PCE inflation data, the Fed’s preferred inflation gauge. Higher-than-expected inflation readings would likely cement expectations for tightening monetary policy, further pressuring the euro and other major currencies against the greenback.

Traders, FX brokers, and institutional investors are closely monitoring this technical breakdown, as the pair approaches key support levels that could trigger additional algorithmic selling. Currency volatility is expected to intensify around the PCE release.

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FXnCO Insight

** Dollar longs are becoming increasingly crowded ahead of PCE data—consider hedging euro exposure or preparing for potential whipsaw price action if inflation figures disappoint hawkish expectations.

Source: FXStreet