EUR/USD is widely expected to remain on a downward trend and has currently fallen to around $1.1193. Downside risk for the euro has increased amid heightened uncertainty ahead of the French presidential election, while waning expectations for an ECB rate hike are also cited as a factor.
With dollar strength dominant, EUR/USD has fallen into the $1.11 range. The market is assessing whether support at the $1.12 level will hold and whether the pair will break below it. EUR/JPY rose to the upper ¥177 range in the first half but struggled to extend its gains in the second half.
The dollar's strength stands out among the four major currencies. The euro faces heightened uncertainty ahead of France's presidential election in the spring, and is viewed as carrying downside risk due to waning expectations for a substantial ECB rate hike. The dollar is firm as a relative choice and is considered highly likely to outperform other currencies this quarter as well. Expectations that EUR/USD will fall further remain strong.