EUR/USD Falls Below 1.0300 as ECB-Fed Policy Divergence Widens

EUR/USD has declined 0.5% to trade below the critical 1.0300 support level, pressured by growing monetary policy divergence between the ECB and Federal Reserve. The euro faces mounting bearish pressure as markets anticipate more aggressive ECB rate cuts in 2024, with inflation in the Eurozone showing signs of approaching the 2% target. Meanwhile, the Fed maintains its hawkish bias, supported by resilient US economic data and persistent inflation concerns. The Dollar Index has strengthened to 109.80, its highest level since November 2022. Technical analysis reveals EUR/USD has broken below the 200-day moving average at 1.0320, opening the path toward 1.0250. Resistance now stands at 1.0350. European economic weakness, particularly in Germany's manufacturing sector, continues to weigh on the euro. Traders are closely watching upcoming ECB minutes and US CPI data for further directional clues.