FX.co ★ Euro Flat as Markets Await US Jobs Data and ECB Meeting

The euro held just above $1.16 on Friday as investors waited for fresh signals from US employment data due later in the day, while focus increasingly turned to the European Central Bank’s September 10 meeting. Money markets still fully price in a 25-basis-point ECB rate increase to 2.5% next week and assign an almost 100% probability that the deposit rate will reach 3% by June 2027, implying two additional hikes by mid-2027.

On the data front, Germany’s factory orders rose 2.5% in July, slowing from an upwardly revised 3.7% gain in June but coming in well above market expectations for a 0.3% increase. At the same time, the US dollar stayed under pressure after dovish comments from Federal Reserve Governor Christopher Waller, who noted that recent figures pointed to disinflation and said that, if upcoming data confirm that trend, he would support leaving interest rates unchanged at this month’s policy meeting.