Dollar Supported by Risk-Off, Euro Only Gains Slightly
The euro (EUR) strengthened slightly against the US dollar (USD) on Friday (February 6th), after briefly touching a two-week low of 1.1765. In the European session, EUR/USD held in the 1.179–1.180 range, indicating the euro was attempting to stabilize despite still "uncomfortable" market sentiment.
What caused the euro's mixed movements was the global risk-off atmosphere. A sell-off in stocks—particularly in the technology sector—reduced investors to a defensive stance, leaving the USD still in "a safe haven" position. Market concerns also intensified as tech giants' increasingly aggressive AI spending, which had yet to fully reflect in profits, weighed on major US indices.
In Europe, euro sentiment was dampened by disappointing German data. German industrial production fell 1.9% (MoM) in December 2025, much weaker than market expectations—a reminder that the manufacturing recovery has not been entirely smooth.
Meanwhile, the ECB held interest rates on Thursday (the deposit rate remained at 2%), as expected. Christine Lagarde emphasized that inflation is considered "on track" toward its target, and hinted that a stronger euro could push inflation down more than expected—although the ECB emphasized that it is not targeting a specific exchange rate level.
On the USD side, the dollar index (DXY) remains relatively strong at around 97.85 after briefly approaching a two-week high, supported by a combination of risk-off sentiment and weak US jobs data (which makes the market more sensitive to the Fed's policy direction).
The next focus is on Friday's agenda: the release of Michigan Consumer Sentiment (prelim February) at 10:00 AM ET (around 10:00 PM WIB) and comments from ECB officials. Additionally, the US Nonfarm Payrolls report for January was postponed to February 11 due to the partial government shutdown—so the "big data" on employment, which usually determines the direction of the USD this week, has not yet been released.
Source: Newsmaker.id
