EUR/USD Drops Below 1.1500 as Hawkish Fed Boosts Dollar

EUR/USD has slipped below 1.1500 after the Federal Reserve delivered a hawkish hold on June 18, lifting the dollar and U.S. yields. The pair had traded near 1.1599 following the ECB’s June 16 rate hike to 2.25% and signals of one more increase in September. Markets initially absorbed ECB Governing Council member Sleijpen’s June 17 comments downplaying 2022-style inflation risks before the Fed’s updated dot plot—showing nine officials expecting a 2026 hike—reversed euro gains. Weak German growth forecasts of 0.8% for 2025-2027 added further downside pressure, leaving the pair capped below 1.1525 amid diverging central-bank paths.