The EURUSD pair looks set for a modest rally into November-December of 2025. The story behind is simple: the Federal Reserve (Fed) is still cutting interest rates, while the European Central Bank (ECB) has hit the pause button. Such a policy divergence may give the single currency a boost against the greenback in the near future.
The latter regulator seems to have finished its most aggressive rate-cutting cycle. With GDP growth and inflation hovering near key targets, the central bank has shifted to a "wait-and-see" stance. Recent comments from ECB President Christine Lagarde and other officials suggest they're comfortable holding steady for now, making future moves entirely dependent on new economic data.
Meanwhile, the Fed is expected to keep cutting rates well into the end of 2025. This policy split—with the American regulator easing while the ECB stays on hold—is the fundamental force that should lift the euro. Market expectations for ongoing Fed rate reductions also hint at underlying concerns about the US economy, putting pressure on the dollar.
This view is echoed on Wall Street. Bank of America (BofA), for instance, is sticking to its year-end 2025 forecast at 1.17, betting on the single currency to strengthen as the policy gap widens. Other analysts predict a recovery as well, particularly in Q4.
Piecing it all together, with fund estimates in play, a slow grind higher for EURUSD into year-end is the most likely path.
Traders see the pair trading in a range of 1.16 to 1.18 by November-December.
The ultimate recommendation is to buy EURUSD at 1.1500. Lock in profits at 1.1700. Place Stop Loss at 1.1390.
Calculate your open position so that a potential loss (protected by a Stop Loss order) is limited to 1% of your deposit. If your account balance does not allow entering a position of this size, it is better to skip the trade and wait for other market signals that meet low-risk criteria.
This content is for informational purposes only and is not intended to be investing advice.
