Key Takeaways

• The European Central Bank’s (ECB) EUR/USD reference rate fell from 1.1652 on 9 September to 1.1193 on 23 October, a 3.94% decline, while both the ECB and the Federal Reserve (Fed) raised rates by 25 basis points.^1,2,3
• Weekly ranges in the ECB’s daily fixings narrowed from 92 pips in the week of 5 October to 72 pips and then 41 pips in the week to 23 October.¹
• CME FedWatch priced a 90.6% probability of a Fed hold on 28 October, and 70 of 73 economists in a Reuters poll taken 5 to 8 October expected the ECB to hold on 29 October.^8,9

EUR/USD’s ECB reference rate fell 3.94% between 9 September and 23 October, from 1.1652 to 1.1193, across a stretch in which the ECB itself raised interest rates.¹ Higher rates are supposed to give a currency a lift. The euro dollar rate seems to have skipped that page of the textbook.

As of 09:42 (GMT+8) on 26 October 2026, the Vantage EURUSD price stood at 1.12188 on the hourly chart, with the latest hourly bar 0.02% higher; across October, the ECB’s daily euro to USD reference rate ranged from 1.1177 to 1.1298.¹ So the EURUSD news today is not a breakout. It is one of the most-watched forex pairs squeezing into an ever-smaller box, right in front of two central bank decisions.

We went back to the source data to find out why. This EUR/USD analysis unpacks three things: why two rate hikes did not lift the euro, why the range keeps tightening, and what that changes about the risk picture into the Federal Reserve decision on 28 October and the ECB decision on 29 October.

Why EUR/USD Fell: The Short Answer

EUR/USD fell 3.94% between 9 September and 23 October as the ECB raised rates. The Fed-ECB policy gap was 150 basis points before and after September’s hikes; the slide appears linked to French bond stress, with France’s 10-year spread over Germany at 157 basis points.

What Moved and What Did Not: EUR/USD Drivers, September to October 2026

Driver	Earlier Reading	Latest Reading	What Changed
EUR/USD (ECB Reference Rate)	1.1652 (9 September)	1.1193 (23 October)	Down 3.94%
Fed Funds Range, Upper Bound	3.75%	4.00% (16 September)	Up 25 bp
ECB Deposit Facility Rate	2.25%	2.50% (10 September)	Up 25 bp
Fed-ECB Policy Gap (Fed Upper Bound Minus ECB Deposit Rate)	150 bp (before both hikes)	150 bp (after both hikes)	Unchanged
French 10-Year Spread Over Bund	Not compared	157 bp (21 October)	Widest since 2009 to 2011
Eurozone Composite PMI	53.1 (September)	51.9 (October flash)	Four-month low
Euro Area Inflation	3.2% (August)	3.8% (September)	Up 0.60 percentage points

Table 1: Sources: European Central Bank,¹ Federal Reserve,² FXStreet,⁶ S&P Global,⁵ Banco de España,³ and Eurostat.⁴ bp = basis points. Data as of 26 October 2026.

The Rate Gap Ended Where It Started

The obvious suspect is the Fed out-hiking the ECB. It is a tidy theory. The numbers do not back it up on their own.

The ECB lifted its deposit facility rate by 25 basis points to 2.50% on 10 September, following a hike to 2.25% in June.^3,16 Six days later the Federal Open Market Committee (FOMC) matched it, moving the federal funds rate range up by 25 basis points to 3.75% to 4.00% in a unanimous 12 to 0 vote.²

Here is the check we ran. Set the top of the Fed’s range against the ECB’s deposit rate and the gap was 150 basis points before both moves (3.75% against 2.25%) and 150 basis points after them (4.00% against 2.50%), dipping to 125 basis points only in the six days between the two decisions. Same gap, yet the euro vs USD rate fell close to 4%.

That check ignores expected future moves and short-dated bond yields, so it rules out the simple version of the story, not every version of it.

So if the policy gap sat still, what was moving the euro? The evidence points to the French bond market, not to Frankfurt.

French Borrowing Costs Weighed on the Euro

Start with one number: 4.98%. That was the yield on France’s 10-year government bond, the Obligation Assimilable du Trésor (OAT), on 21 October, its highest in 24 years, according to FXStreet.⁶ The spread over Germany’s 10-year Bund reached 157 basis points, the widest, by FXStreet’s count, since the 2009 to 2011 financial crisis.⁶

A wider spread means investors want more to hold French debt than German debt. Germany, France, Italy, and Spain account for about 75% of euro area output, FXStreet notes, so stress in one of the four tends to show up in euro pricing.⁶

The timing lined up neatly. EUR/USD dropped below 1.1300 for the first time since May 2025 on 1 October, in a week FXStreet tied to higher oil prices, rising US Treasury yields, and worries over France’s public debt.⁷ The ECB’s fixings hit their October low of 1.1177 on 7 October.¹

Growth Data Added a Second Layer

S&P Global’s flash eurozone composite Purchasing Managers’ Index (PMI) slipped to 51.9 in October from 53.1, a four-month low, with French private-sector output back in contraction.⁵ Chris Williamson, Chief Business Economist at S&P Global Market Intelligence, put it plainly: “Higher interest rates are also starting to take a toll.”⁵

Inflation explains why the ECB tightened anyway. Euro area annual inflation was already 3.2% in August and rose to 3.8% in September, with core inflation, which excludes energy, food, alcohol, and tobacco, at 2.5%.⁴ The September figure arrived after the hike, which is one reason December is still in play.

The Backstop Built for This

The ECB does have a tool for spread stress. In July 2022 it approved the Transmission Protection Instrument (TPI), to counter unwarranted, disorderly market dynamics that threaten how monetary policy passes through to every euro area member.^[10] Strategists at Brown Brothers Harriman (BBH) pointed out in early October that the TPI, designed as “a backstop against disorderly spread widening,” is not an automatic shield for euro area debt markets, as quoted by FXStreet.¹¹ That is why Thursday’s press conference may say as much about French spreads as about rates.

That accounts for the slide into early October. It does not explain why the pair then stopped falling.

Why the EUR/USD Range Keeps Narrowing

Pips tell this part of the story better than percentages. The ECB’s weekly fixing range shrank from 92 pips in the week of 5 October to 72 pips the following week and just 41 pips in the week to 23 October, each figure being the gap between that week’s highest and lowest daily reference rate.¹

Part of the answer sits in rate expectations, which now line up almost identically for the two central banks. CME FedWatch showed a 90.6% probability of a Fed hold this week and a 79.7% probability of a December hike, as of 26 October.⁸ A Reuters poll taken 5 to 8 October found 70 of 73 economists expecting the ECB to hold on 29 October, in line with market pricing at the time, and 64 expecting a December hike.⁹

The rest sits on the dollar side. ING analysts said on 21 October that the US dollar “continues to trade with a soft undertone,” linking it partly to AI-related market jitters and stretched long positions being unwound, as quoted by FXStreet.⁶

Put those together and the read is that euro USD pricing has not gone quiet for lack of news. It appears to be balancing two forces of similar size: French spread stress pressing on the euro and a softer dollar cushioning it, while the policy gap that often anchors the pair looks frozen until December on current pricing.

The policy gap between Washington and Frankfurt was 150 basis points before both September hikes and 150 basis points after them.

So what did that tug of war look like on the EURUSD chart?

EUR/USD Technical Analysis: Lower Highs, Flat Floor

On the hourly EUR USD chart used for this EUR/USD technical analysis, highs stepped lower: near 1.1270 on 16 October, near 1.1261 on 20 October, and near 1.1256 on 22 October, as of the 09:42 (GMT+8) cut-off on 26 October.

Lows, by contrast, clustered on a narrow shelf between about 1.1181 and 1.1189 from 19 to 23 October. Monday’s Asia session then lifted the pair from Friday’s close near 1.1200 to 1.1219 by the cut-off, in line with FXStreet’s report of the pair near 1.1220 in early Asian trade.¹⁵

The 50-period and 200-period moving averages read 1.12135 and 1.12144, less than a pip apart, with price just above both. They were close enough to share a postcode.

The 14-period Relative Strength Index (RSI) on the TradingView setup used for this analysis read 58.35 at the cut-off, above its own moving-average line at 48.37. It touched roughly 71 on 16 October and dipped to around 32 on 22 and 23 October without closing below 30. Momentum recovered into Monday’s Asia session, while price stayed inside last week’s band.

EUR/USD Levels Traders Are Watching, as of 09:42 (GMT+8) on 26 October 2026

Level	Price	Chart Reference
Upper Reference	1.1270	16 October high
Level 2 Resistance	1.1256 to 1.1261	20 and 22 October highs
Level 1 Resistance	1.1224	26 October Asia-session high to cut-off
Moving Averages	1.1213 to 1.1214	50- and 200-period hourly averages
Level 1 Support	1.1181 to 1.1189	19 to 23 October lows
Level 2 Support	1.1177	Lowest October ECB reference rate (7 October)

Table 2: Levels read from the Vantage EURUSD hourly chart on TradingView and the European Central Bank euro reference rate table,¹ as of 09:42 (GMT+8) on 26 October 2026. Indicative only.

The chart maps the band. The calendar maps the events scheduled inside it this week.

EUR/USD Questions Traders Are Asking

What Is the Euro to USD Rate Today?

As of 09:42 (GMT+8) on 26 October 2026, the Vantage EURUSD price was 1.12188 on the hourly chart. The ECB’s latest EUR to USD reference rate, set on 23 October, was 1.1193.¹

Is There a EUR/USD Forecast Today?

Searches for a EURUSD forecast today, a euro to USD forecast, or a euro US dollar forecast usually want one number. Vantage does not publish a EUR/USD price forecast, a EUR USD forecast range, or EUR/USD trading signals. What market pricing and economists do point to is a rate path: a hold this week and December as the live meeting for both banks.^8,9 A chart is a record of where price has been, not a promise about where it goes.

What Moves the Euro vs USD This Week?

The scheduled drivers are the Fed decision, US third-quarter growth and inflation data, and the ECB decision; the unscheduled one is the French bond spread.^6,8 Whether the interest is short-term trading or longer-horizon EURUSD investing, those four items frame the week’s forex news today.

Thursday’s Event Window and Risk

On a GMT+8 clock, the three scheduled events most closely tied to EUR/USD this week land on the same date, Thursday 29 October. For Asia-based traders, that Thursday reads less like a trading day and more like a timetable.

• FOMC Decision, 29 October: Statement at 02:00 (GMT+8), followed by Chair Kevin Warsh’s press conference at 02:30 (GMT+8).¹² With a hold priced at 90.6%, the information may sit in whether December is signalled.⁸
• US Q3 GDP and September PCE, 29 October: The advance gross domestic product (GDP) estimate and personal consumption expenditures (PCE) price data are scheduled for 20:30 (GMT+8).¹⁴
• ECB Decision, 29 October: Decision at 21:15 (GMT+8), press conference at 21:45 (GMT+8).¹³ Any mention of French spreads, the TPI, or the balance sheet speaks to the euro’s main pressure point.
• French 10-Year Spread, Ongoing: The 157 basis point level reported on 21 October is the reference point.⁶

The read that EUR/USD is balanced between French stress and a soft dollar weakens if Fed communication firms up December pricing well beyond the ECB’s, or if the French spread narrows sharply; either would break the symmetry described above. It holds while both central banks keep December as the live meeting and the spread stays elevated.

The ECB’s reference-rate table opened this piece with a puzzle: a currency falling while its central bank tightened. On the evidence here, the headline rate gap ended September where it started, while French borrowing costs climbed. Thursday puts both central banks on the record within about 19 hours, which tests whether that gap stays frozen.

Event windows like Thursday’s can bring fast moves and price gaps, and spreads on EURUSD positions can widen around scheduled releases. A Stop Loss order is designed to close a position at a pre-set level and limit losses to a planned size, although in a gap the fill can occur at a worse price than the level set. A position held across three releases in one session is exposed to each of them, not only to the one in focus.

Leverage works in both directions. At 1:30, the maximum for major currency pairs for UK retail clients, a 0.50% move in EUR/USD equals a 15% change in the margin committed to a position, whether the move runs with it or against it; the 92-pip weekly range in the ECB’s early-October fixings was about 0.82% of the pair’s value.¹ Position sizing relative to account equity, rather than to available margin, is one way traders frame that exposure ahead of high-impact events.

Related Reading

• EURUSD News
• ECB News and Analysis
• Federal Reserve News

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References

[1] “US Dollar (USD) Euro Reference Exchange Rate – European Central Bank” https://www.ecb.europa.eu/stats/policy_and_exchange_rates/euro_reference_exchange_rates/html/eurofxref-graph-usd.en.html Accessed on 26 October 2026.

[2] “Federal Reserve Issues FOMC Statement, 16 September 2026 – Board of Governors of the Federal Reserve System” https://www.federalreserve.gov/newsevents/pressreleases/monetary20260916a.htm Accessed on 26 October 2026.

[3] “El BCE Sube los Tipos 25 Puntos Básicos en Septiembre – Banco de España” https://www.bde.es/wbe/es/noticias-eventos/actualidad-bce/decisiones-politica-monetaria/el-bce-sube-los-tipos-25-puntos-basicos-en-septiembre-2026.html Accessed on 26 October 2026.

[4] “Annual Inflation Up to 3.8% in the Euro Area – Eurostat” https://ec.europa.eu/eurostat/web/products-euro-indicators/w/2-16102026-ap Accessed on 26 October 2026.

[5] “S&P Global Flash Eurozone PMI, October 2026 – S&P Global” https://www.pmi.spglobal.com/Public/Home/PressRelease/460d8e59c101498493559df807c62014 Accessed on 26 October 2026.

[6] “Euro Trims Gains but Remains Above 1.1200 With France Still in the Spotlight – FXStreet” https://www.fxstreet.com/news/euro-trims-gains-but-remains-above-11200-with-france-still-in-the-spotlight-202610210852 Accessed on 26 October 2026.

[7] “1.1265: Euro Hits Yearly Lows Amid High Oil Prices, Rising US Yields and Debt Woes – FXStreet” https://www.fxstreet.com/news/11265-euro-hits-yearly-lows-amid-high-oil-prices-rising-us-yields-and-debt-woes-202610011019 Accessed on 26 October 2026.

[8] “Canadian Dollar Gains Despite Lower Oil Prices – FXStreet” https://fxstreet.com/news/canadian-dollar-gains-despite-lower-oil-prices-202610260121 Accessed on 26 October 2026.

[9] “ECB to Hike Rates Again in December as Inflation Almost Doubles 2% Target: Reuters Poll – RTÉ” https://www.rte.ie/news/business/2026/1008/1594593-ecb-interest-rates-poll/ Accessed on 26 October 2026.

[10] “The Transmission Protection Instrument, 21 July 2022 – European Central Bank” https://www.ecb.europa.eu/press/pr/date/2022/html/ecb.pr220721~973e6e7273.en.html Accessed on 26 October 2026.

[11] “Euro Weakens Below 1.1250 on France Debt Concerns – FXStreet” https://www.fxstreet.com/news/euro-weakens-below-11250-on-france-debt-concerns-202610060159 Accessed on 26 October 2026.

[12] “Meeting Calendars and Information – Board of Governors of the Federal Reserve System” https://www.federalreserve.gov/monetarypolicy/fomccalendars.htm Accessed on 26 October 2026.

[13] “Meetings of the Governing Council and the General Council – European Central Bank” https://www.ecb.europa.eu/press/calendars/mgcgc/html/index.en.html Accessed on 26 October 2026.

[14] “Release Schedule – U.S. Bureau of Economic Analysis” https://www.bea.gov/news/schedule Accessed on 26 October 2026.

[15] “Euro Edges Higher Above 1.1200 Despite French Debt Worries – FXStreet” https://www.fxstreet.com/news/euro-edges-higher-above-11200-despite-french-debt-worries-202610260126 Accessed on 26 October 2026.

[16] “ECB Raises Rates by 25 Basis Points in June – Banco de España” https://www.bde.es/wbe/en/noticias-eventos/actualidad-bce/decisiones-politica-monetaria/bce-tipos-junio26.html Accessed on 26 October 2026.