US Dollar Price Forecast: ECB Holds Steady, PMI Data in Focus

Published: July 24, 2026

Key Highlights

• The European Central Bank (ECB) has kept interest rates unchanged, maintaining a data-dependent approach amid ongoing energy inflation risks.
• The US Dollar Index (DXY) remains above key support levels, indicating a bullish medium-term outlook.
• Attention is shifting towards upcoming US PMI data, which is expected to provide insights into the resilience of the US economy ahead of the Federal Reserve meeting.

Market Reactions

Following the ECB's decision to maintain its benchmark rates, the market has recalibrated its focus towards the upcoming US PMI data. The ECB held the deposit rate at 2.25%, the main refinancing rate at 2.40%, and the marginal lending facility rate at 2.65%. ECB President Christine Lagarde emphasized a cautious, data-dependent approach moving forward, particularly in light of inflationary pressures from rising energy prices due to geopolitical tensions in the Middle East.

US Dollar Index (DXY) Analysis

The DXY has shown resilience, bouncing off the 100.50-100.60 support area and currently trading around 101.33. It remains above both the 50-day and 100-day exponential moving averages (EMAs), suggesting that buyers are in control. The first resistance levels are identified at 101.65, 102.06, and 102.42, while support is seen at 101.20, with further levels at 100.50 and 99.92. A sustained position above 101.20 could lead to further gains, while a drop below 100.50 may signal a bearish shift.

GBP/USD and EUR/USD Technical Analysis

GBP/USD

The GBP/USD pair is currently under pressure, trading around 1.3334, below key resistance levels. The pair has been rejected from the upside triangle channel and is unable to reclaim the former support area at 1.3393. Initial support is at 1.3274, with a potential further decline towards 1.3218 if bearish momentum continues.

EUR/USD

EUR/USD is also facing bearish pressure, trading near 1.1391. The pair has failed to consolidate above the former triangle support, which now acts as resistance at 1.1408. Immediate support is at 1.1364, with further declines possible towards 1.1325 if the bearish trend persists. A rebound above 1.1408 would indicate a potential shift in momentum.

Conclusion

The market is closely watching the upcoming PMI data, which could provide further evidence of the US economy's resilience. The ECB's steady approach and the current technical setups for the DXY, GBP/USD, and EUR/USD suggest a cautious but potentially bullish outlook for the US dollar in the near term.