FX.co ★ Euro Holds Below $1.14 as Investors Digest Key Data

The euro rebounded from its earlier declines but lingered slightly below the $1.14 threshold, as investors assessed varying economic signals emanating from the United States and Europe. The U.S. economy saw an unexpected contraction at an annual rate of 0.3% in the first quarter of 2025, primarily driven by a significant surge in imports. This increase was attributed to businesses and consumers advancing their purchases in anticipation of imminent tariffs proposed by the Trump administration. Conversely, the Eurozone economy experienced more robust growth than anticipated, expanding by 0.4%, bolstered by strong domestic demand. Among the major European economies, Germany's growth was in line with predictions at 0.2%, whereas France showed a lackluster performance with only a 0.1% increase. In terms of inflation, Germany's headline inflation rate eased to 2.1% in April, although underlying pressures remained elevated, while France's annual rate remained constant at 0.8%. Despite the relatively subdued inflation figures, the euro was poised to record a monthly gain exceeding 5% against the dollar, primarily due to continued uncertainty surrounding U.S. trade policy, which has dampened confidence in American financial assets.