2026.02.1610:38:58UTC+00Euro Holds Firm as ECB Signals Confidence

The euro traded around $1.185, holding close to the four-year high above $1.20 reached in late January, underpinned by indications that the European Central Bank is broadly comfortable with the currency’s recent appreciation. Following the February policy meeting, ECB President Christine Lagarde noted that the euro area’s inflation outlook is in a “good place,” while warning against overreacting to short-term or volatile data.

Additional support for the single currency came from reports that Bank of France Governor François Villeroy de Galhau, widely regarded as a dovish policymaker, will step down in June, well ahead of his term’s scheduled end in October 2027.

On the data front, Eurozone industrial production declined 1.4% in December, broadly in line with market expectations. In the United States, inflation slowed more than anticipated to 2.4% in January, bolstering expectations that the Federal Reserve may have room to ease monetary policy. Investors now look ahead to Wednesday’s release of the Fed’s meeting minutes for further clues on the policy outlook.