Published: 6 March 2026,08:05
Daily Market Analysis New
*Final data from Eurostat confirmed Q4 GDP growth at 0.3% QoQ and 1.3% YoY, with full-year 2025 expansion improving to 1.5%.
*February inflation rose to 1.9% YoY, close to the European Central Bank 2% target, reducing pressure for aggressive rate cuts.
*Unemployment fell to a record low 6.1%, strengthening economic resilience and helping keep EUR/USD supported near the 1.15–1.20 range.
Market Summary:
The final Q4 2025 Eurozone GDP estimate released by Eurostat today confirmed steady growth of 0.3% quarter-on-quarter and 1.3% year-on-year, in line with previous flash and second estimates. This brought full-year 2025 expansion to 1.5%, an improvement from 0.9% in 2024, highlighting the region’s resilience despite challenges from trade tensions and geopolitical uncertainty. Growth was supported by solid performances in Spain and the Netherlands, with more moderate contributions from Germany and Italy, while France lagged slightly.
Recent data further reinforces this positive backdrop. February 2026 flash inflation rose to 1.9% year-on-year from 1.7% in January, surpassing expectations of stability. Services inflation accelerated to 3.4%, core measures increased to 2.4%, and energy price declines moderated to -3.2%. This keeps headline inflation close to the ECB’s 2% target, reducing the case for aggressive rate cuts and enhancing confidence in euro stability.
The labor market also showed strength, with the January 2026 seasonally adjusted unemployment rate dropping to a record low of 6.1% from 6.2% in December, beating forecasts of no change. This improvement, equivalent to about 10.77 million unemployed, reflects robust job creation that supports household consumption and sustains economic momentum.
In this context, today’s in-line GDP print, alongside the inflation rebound and unemployment improvement, provides a supportive domestic foundation for the euro. The ECB appears positioned to hold rates steady, potentially narrowing interest rate differentials with the Federal Reserve if U.S. data softens. EUR/USD has traded choppily around 1.16 levels in early March 2026, with analysts pointing to a consolidation range of roughly 1.15 to 1.20 in the near term. Moderate appreciation remains feasible, with potential upside of 3-5% over the next one to three months toward 1.19, assuming external shocks are avoided.
Technical Analysis
The EURUSD pair has been dominated by strong bearish momentum, declining approximately 4 percent from its January high. However, the pair is now consolidating above a critical support level at 1.1580, a zone that has attracted significant buying interest and represents the lower boundary of the recent trading range. A sustained break above this consolidation range would signal a technical rebound, positioning the pair to challenge the next resistance level near 1.1710.
Technical analysis confirms that the 1.1580-1.1600 region serves as a pivotal support zone. A decisive move above the 1.1640-1.1650 area would target the nine-day EMA at 1.1686 and the 50-day EMA at 1.1753 . The measured move from a range breakout could extend toward 1.1760, aligning with the 38.2% Fibonacci retracement level.
Momentum indicators have turned constructive following the extended decline. The Relative Strength Index has risen above oversold territory to near 42, recovering from levels below 35 that reflected intense selling pressure . The Moving Average Convergence Divergence has generated a bullish golden cross from deeply oversold levels, suggesting that bearish momentum is dissipating and a potential trend reversal is building.
Resistance Levels:1.1710, 1.1870
Support Levels: 1.1460, 1.1340
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