Account
New to ADSS? Open an
account now to get started.
Already have an account?
Add funds to your ADSS account
Account
New to ADSS? Open an
account now to get started.
Add funds to your ADSS account
Asset Watch
Wednesday, 12 March 2025
At the latest European Central Bank meeting, President Christine Lagarde described interest rates as “less restrictive,” signaling that Governing Council members are open to slowing the pace of rate cuts. Despite this, policymakers considered that the Bank’s neutral interest rate target might be below 2.5%—likely in the range of 1.75% to 2.25%—to mitigate potential economic downturns in Europe, particularly in response to the tariffs President Trump plans to impose on European goods.
ECB forecasts project economic growth of 0.9% in 2025 and 1.2% in 2026, with inflation expected at 2.3% in 2025 and 1.9% in 2026.
The euro received a boost after German politicians moved closer to an agreement on increasing defense spending, proposing a €500 billion infrastructure and defense fund. This initiative comes amid signals from the Trump administration that the U.S. may reduce its defense commitments in Europe. Notably, Elon Musk, Trump’s chief of Department of Government Efficiency, even suggested a full U.S. withdrawal from NATO.
This shift could encourage more European governments to follow Germany’s lead by raising defense budgets, potentially driving higher economic growth. As a result, the ECB may face less pressure to support the economy through aggressive rate cuts. Consequently, the euro’s trajectory could increasingly be influenced by fiscal policies across European nations, alongside ECB monetary policy.
On March 11, the euro strengthened against the dollar, reaching its highest level since the first week of October last year. The Relative Strength Index surpassed 70, signaling strong bullish momentum. Right now, prices are testing the lower end of the current trading zone set between 1.0885 and 1.1060.
A daily close below the low end of this zone could indicate a potential decline toward 1.0762. Additionally, a drop in the RSI below 70 would suggest a weakening upward momentum, signaling a possible downturn in the EUR/USD pair.
Sustained trading above the low end of the current trading zone suggests a continuation of the upward trend, possibly sending the price for a test of the high end of the zone at 1.1060. A daily close above this level would confirm bullish momentum, potentially driving prices even higher toward 1.1176. That said, the resistance level at 1.1110 should be kept in focus.
Chart Source: ADSS Platform
ADSS
8th floor, CI Tower
Corniche Road
PO Box 93894
Abu Dhabi
United Arab Emirates
Trading Services
ts@adss.com
+971 2 657 2414
Investing in CFDs involves a high degree of risk that you will lose your money due to the use of leverage, particularly in fast moving markets, where a relatively small movement in the price can lead to a proportionately larger movement in the value of your investment. This can result in loses that exceed the funds in your account. You should consider whether you understand how CFDs work and you should seek independent advice if necessary.
ADS Securities LLC – S.P.C (“ADSS”) is authorised and regulated by the Securities and Commodities Authority (“SCA”) in the United Arab Emirates under First Category: Dealing in Securities and Fifth category: Arrangement and advice (Introduction). ADSS is a Limited Liability Company – Sole Proprietorship Company incorporated under United Arab Emirates law. The company is registered with the Department of Economic Development of Abu Dhabi (No. 1190047) and has its principal place of business at 8th Floor, CI Tower, Corniche Road, P.O. Box 93894, Abu Dhabi, United Arab Emirates.
The information presented is not directed at residents of any particular country outside the United Arab Emirates and is not intended for distribution to, or use by, any person in any country where the distribution or use is contrary to local law or regulation.
ADSS is an execution only service provider and does not provide advice. ADSS may publish general market commentary from time to time. Where it does, the material published does not constitute advice, or a solicitation, or a recommendation to a transaction in any financial instrument. ADSS accepts no responsibility for any use of the content presented and any consequences of that use. No representation or warranty is given as to the completeness of this information. Anyone acting on the information provided does so at their own risk.
