Makhlouf said that the euro had been finding strength against the dollar on a daily basis, with only intermittent corrections prompted by solid U.S. fundamentals, and that the next policy move could be either to raise or to lower borrowing costs.

He said that he did not rule out further rate cuts and even the possibility of increases and added that inflation appeared to be moving in the right direction and was in line with the ECB's target, leaving the bank well positioned.

Makhlouf, speaking without unnecessary detail, said the Governing Council stood ready to respond to changing economic conditions. He added that, with no present inflationary problems, there was no need to speculate in advance about policy, but he warned that the ECB did not rule out a scenario in which growth slowed or encountered other challenges; in that event any cut in borrowing costs would be intended to stimulate activity, ease access to capital for businesses and households, and mitigate potential negative consequences of a slowdown.

Recall that earlier this month ECB officials left interest rates unchanged at their fifth meeting, and President Christine Lagarde reaffirmed the central bank's now standard position that it considers itself well positioned. Investors and economists expect rates to remain unchanged through 2027.

Makhlouf said that inflation had reached very good levels and was essentially at the target, and that the ECB aimed to achieve 2% inflation over the medium term. He added that, given the prevailing uncertainty, the bank would continue to take a meeting-by-meeting, data-driven approach, reviewing the evidence and analyzing incoming data, and that while precise outcomes were hard to predict, the bank was moving in the right direction for now.

A technical outlook for EUR/USD suggests that buyers should consider reclaiming 1.1890. That would open the way to test 1.1925. From there, a push to 1.1957 is possible, although advancing beyond that without support from major players would be difficult. The extended target is 1.1994. On a decline, meaningful buying interest is likely near 1.1850. If buyers do not appear there, it would be prudent to wait for a new low at 1.1830 or to open long positions from 1.1800.