The euro is under pressure. In the week of 5 October 2026, EUR/USD fell to around 1.1160 — its weakest level since May 2025 — before stabilising near 1.12. The main reason is a widening gap between US and European interest rates.
- The Fed hiked in September 2026, its first increase since 2023, taking rates to 3.75%–4.00%.
- The ECB deposit rate sits at 2.50%, leaving a large rate gap in the dollar’s favour.
- Watch the Fed (27–28 October) and ECB (28–29 October) meetings for the next big move.
Why EUR/USD Is Falling
- Rate differentials. The Fed’s September hike put the federal funds range at 3.75%–4.00%, well above the ECB’s 2.50% deposit rate.
- High US yields. 30-year US Treasury yields reached about 5.6%, their highest level since 2000, supporting the dollar.
- Energy prices. Higher oil prices hurt the eurozone, which imports most of its energy.
- European political risk. BNP Paribas highlights political uncertainty in Europe as a further drag on the euro.
What Analysts Expect Next
| Source | View on EUR/USD |
|---|---|
| BNP Paribas | 3-month target 1.12; 12-month target 1.20 (bearish on the dollar long term) |
| Cambridge Currencies | Six-month range of 1.11–1.19 |
| Market pricing (early October) | October Fed hike odds fell sharply after weak US jobs data |
Forecasts disagree, which is exactly why risk management matters more than predictions.
Key Dates for EUR/USD Traders
| Date | Event |
|---|---|
| 14 October | US CPI (September) |
| 27–28 October | Federal Reserve meeting |
| 28–29 October | European Central Bank meeting |
| 5 November | Bank of England decision |
Trading EUR/USD in a Prop Firm Account
Central bank weeks bring sharp moves and wider spreads. Before you trade them in an evaluation or funded account:
- Check the news rule. Some firms block trades a few minutes around high-impact news on funded accounts — for example, E8 Markets’ E8 One and Tradeify FX funded accounts restrict trading 5 minutes before and after major news, while BrightFunded deducts profit from that window on funded accounts.
- Size down before the event. A gap through your stop can hit the daily loss limit in one move.
- Mind the daily loss reset time so an overnight move does not count against two days.
Compare news rules and drawdown types across all firms in our forex prop firm comparison.
Frequently Asked Questions
Why is EUR/USD falling in October 2026?
The Fed raised rates in September 2026 to 3.75%–4.00% while the ECB deposit rate is 2.50%. That rate gap, high US yields and energy prices are weighing on the euro.
When are the next Fed and ECB meetings?
The Federal Reserve meets on 27–28 October 2026 and the European Central Bank on 28–29 October 2026.
Can I trade news with a forex prop firm?
It depends on the firm and account stage. Some firms allow news trading freely, while others restrict trades a few minutes around high-impact releases. Check each firm’s rules in our forex prop firm table.
This article is for information and education only and is not financial advice. Trading futures, forex and CFDs carries a high risk of loss. InsidePropFirm may earn a commission when you buy through our links, at no extra cost to you.
