EUR/USD Slips Below 1.1900 As Hawkish Fed Pushback Lifts Dollar

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The Euro retreats during the North American session edges below the 1.1900 figure against the Greenback as some Federal Reserve officials pushed back against further rate cuts, even though US Retail Sales data, disappointed traders. At the time of writing, the EUR/USD trades at 1.1895 after reaching a daily high of 1.1928.

Euro eases despite weak US Retail Sales as Federal Reserve officials dampen near-term rate-cut expectations

Market mood remains negative as US equities turned negative in the day. Economic data from the US revealed that households are struggling with higher prices and show concerns about the labor market, as Retail Sales in December came at 0% MoM, below estimates for a 0.4% increase and November’s 0.6% print.

At the same time, the Employment Cost Index (ECI) for the last quarter of 2025 rose by 0.7% QoQ, beneath the July-September quarter of 0.8% and missed estimates. The report suggests that there’s some weakness in the labor market as policymakers use the ECI as a measure of jobs market slack.

Fed policymakers push back against lowering interest rates

In the meantime, Federal Reserve Regional Bank Presidents, crossed the wires. Dallas Fed Lorie Logan said commented that monetary policy is neutral, that inflation risks are tilted to the upside and that she is more concerned with that, than downside growth risks.

Earlier, Cleveland’s Fed Beth Hammack she was also hawkish, said that “it is important to get 2% inflation before changing rates again.” She added that inflation is too high and that tariff issues are still in play.

In Europe, the economic docket was absent on Tuesday, yet the European Central President Christine Lagarde seems confident that inflation in the bloc will stabilize at around 2% in the medium term.

Aside from this divergence between the Fed and the ECB, favors further EUR/USD upside. Data from Prime Market Terminal shows that money markets had priced in nearly 60 basis points of interest rate reductions of the Federal Reserve. Conversely, the ECB is projected to hold rates unchanged throughout the year and with first move expected to see being a rate rise.

Source: Prime Market Terminal

Economic schedule for February 12

The Eurozone docket will feature speeches by ECB’s Mario Cipollone and Isabel Schnabel. Across the pond, traders will eye Nonfarm Payrolls figures, the update of the Unemployment Rate and speeches by Fed officials Jeffrey Schmid, Michell Bowman and Beth Hammack.

Technical outlook: EUR/USD to remain trading sideways, waiting for fresh catalyst

The EUR/USD trend is neutral, yet after establishing a higher lower low after hitting the yearly high of 1.20979 at around 1.1765. Since then, the pair has rallied towards 1.1900, though bullish momentum has faded as depicted by the Relative Strength Index (RSI).

For a bullish outcome, traders are eyeing a decisive break above 1.1900. Once cleared, the next stop would be the January 30 high at 1.1974, followed by January 29 peak at 1.1996 ahead of 1.2000.

Conversely, if bears drive price below the 1.1850 area, it will expose the 1.1800 figure, followed by the February 6 cycle low of 1.1765. A breach of the latter will open the door to tes the 100-day Simple Moving Average (SMA) at 1.1681, ahead of the 200-day SMA at 1.1625.