EUR/USD continues to struggle

CB's Olli Rehn suggests two rate cuts this year, potentially lowering borrowing costs to 2.25% by 2025.

By Nadia Elbilassy | @Nadia Elbilassy | 26 June 2024

Market open
  • European financial markets brace for volatility as French elections approach, impacting EUR/USD.

  • Investors hold back from large positions, awaiting US GDP and PCE data for the next significant market catalyst.

  • Oil prices fell in Asian trading amid doubts about global demand and an unexpected rise in U.S. inventories.


ECB governing council Olli Rehn signals two rate cuts this year, potentially lowering borrowing costs to 2.25% by 2025, are justified. the Finnish central-bank chief stressed the importance of bringing inflation back to 2% without significantly slowing down economic activity.

The EUR/USD was fell to $1.0693, being under pressure ahead of the French parliamentary elections, which serves as a major risk event to the pair’s trajectory.

European financial markets brace for turbulence as the French parliamentary elections approach. The first round of the French elections is set for June 30, with the final round a week later on July 7. French President Emmanuel Macron faced significant backlash on Tuesday for suggesting that a win by far-right or hard-left factions in upcoming snap polls could lead to a "civil war." Also weighing significantly on the pair.

Investors are also seen refraining from taking large positions, while waiting for the next significant catalyst, including US GDP and PCE data.


Oil prices fell slightly in Asian trading, continuing steep declines from the previous session due to ongoing doubts about global demand, particularly following data that showed an unexpected rise in U.S. inventories.

Unexpected Build in U.S. Inventories - API The American Petroleum Institute reported on Tuesday that U.S. oil inventories increased by about 0.9 million barrels (mb) in the week ending June 21, contrary to expectations of a 3 mb draw.

This follows a 2.3 mb increase the previous week and raises concerns that U.S. fuel demand remains weak despite the start of the travel-heavy summer season.

Brent oil futures for August fell 0.1% to $84.90 a barrel, while West Texas Intermediate crude futures fell to $80.78 a barrel.