EUR/USD edges lower as ECB signals rate cut cycle nearing completion

EUR/USD has slipped 0.2% to 1.0780 following ECB officials' confirmation that the monetary easing cycle is approaching its end. ECB's Muller agreed with President Lagarde's assessment, reinforcing market expectations of limited rate cuts ahead. Markets have already priced in one additional 25 basis point cut this year, targeting a terminal rate of 1.75%. The key shift in sentiment stems from revised timing expectations, with traders now favoring a December rate cut over the previously anticipated September move. This hawkish tilt in ECB communication has provided temporary support for the euro despite the ongoing easing cycle. Technical indicators show EUR/USD testing support at 1.0775, with resistance at 1.0820. The pair's direction will likely depend on upcoming ECB meeting minutes and eurozone inflation data, as markets reassess the pace and extent of monetary policy normalization.