The euro fell in European trading on Friday against a basket of global currencies, extending its losses for the fourth consecutive day against the US dollar, following the European Central Banks monetary policy meeting, whose outcome largely matched market expectations.

In its final meeting of 2025, the European Central Bank left interest rates unchanged for the fourth consecutive time, while raising its growth forecasts, suggesting that growth will be stronger than previously estimated, driven in particular by domestic demand.

Price overview

Euro exchange rate today: The euro slipped by around 0.1% against the dollar to 1.715, from the opening level of 1.1723, and recorded a session high at 1.1729.

On Thursday, the euro ended trading down 0.15% against the dollar, marking its third consecutive daily loss, amid ongoing corrective moves and profit-taking from a three-month high of 1.1804.

US dollar

The dollar index rose by 0.1% on Friday, maintaining gains for the third session in a row, reflecting continued strength in the US currency against a basket of major and secondary currencies.

In addition to buying from lower levels, the dollar is benefiting from easing inflationary pressures on some global central banks, which supports expectations of continued monetary easing and further interest rate cuts.

European Central Bank

In line with expectations, the European Central Bank on Thursday kept its key interest rates unchanged at 2.15%, the lowest level since October 2022, marking the fourth consecutive meeting without a change.

The ECB reiterated its data-dependent, meeting-by-meeting approach without committing to a specific interest rate path, noting that current interest rate levels are appropriate given stable inflation and economic growth.

Christine Lagarde

ECB President Christine Lagarde said on Thursday that the bank remains in a good position, stressing that there is consensus within the Governing Council to keep all options open, including the possibility of raising interest rates if necessary.

Lagarde noted that the European economy is showing greater resilience than expected, with growth supported by domestic demand. She avoided directly addressing the possibility of rate hikes in 2026, but emphasized caution amid geopolitical and trade risks.

European interest rates

Money markets are currently pricing the probability of a 25-basis-point rate cut by the European Central Bank in February 2026 at less than 10%.

Views and analysis

Analysts at Barclays, led by Mariano Cena, said in a note to investors that the ECB meeting did not provide any new information that would change their view on the most likely path of monetary policy or the balance of risks surrounding it.

They added that they continue to expect the ECB to keep interest rates unchanged over the next two years, and see risks tilted toward rate cuts rather than hikes over their forecast horizon.