We'll find out very soon whether the euro is once again prepared for the European Central Bank (ECB) to continue easing monetary policy.

Today, the ECB is expected to lower interest rates for the seventh time. This step became likely after U.S. President Donald Trump's tariffs rattled markets and clouded the economic outlook for the eurozone and the global economy as a whole. The deposit rate is expected to be cut from 2.5% to 2.25%, while the key interest rate will likely be lowered from 2.65% to 2.4%.

The announcement of sweeping U.S. trade tariffs has effectively ended speculation that the ECB might pause its rate-cutting campaign this week—a campaign that began in June of last year. These measures are now expected to restrain economic growth rather than boost inflation, making markets nearly certain that borrowing costs will be reduced again today.

Following today's meeting, many economists and investors anticipate at least two more rate cuts by year-end, as a stronger euro helps contain price pressures and raises the risk that cheap Chinese goods will be redirected to Europe.

Given that trade negotiations remain uncertain, President Christine Lagarde is unlikely to provide clear guidance on the ECB's future rate path. Her press conference will be held 30 minutes after the rate decision is announced.

Since the March rate cut, few European officials have spoken about a possible pause. However, planned increases in government spending in Germany and other countries have supported calls for a cautious approach. Trump's "Liberation Day," however, has shifted the outlook, prompting stronger support for further easing from officials such as Francois Villeroy de Galhau (Governor of the Bank of France), Olli Rehn (Governor of the Bank of Finland), and Gediminas Simkus (Governor of the Bank of Lithuania), among others. Among those urging caution is Austria's Robert Holzmann, who stated he sees no reason for a cut but remains open to compelling arguments.

As noted earlier, the primary argument for cutting rates lies in the region's economic outlook. Optimism that hundreds of billions of euros in German infrastructure spending—along with a broader rearmament plan for Europe—could revive the weakening continental economy has been dampened by fears that tariffs will negate most growth hopes for this year. Dutch central bank chief Klaas Knot recently highlighted the complexity of the situation, stating that the effects could evolve over time and that the ECB must remain highly vigilant.

Many economists are speculating about how Germany's new fiscal plans will impact inflation. A group of leading German economists has raised their inflation forecast for this year, although they expect the full impact of the new fiscal rules to materialize no earlier than 2026.

Technical Outlook for EUR/USD

Currently, buyers need to focus on reclaiming the 1.1405 level. Only then can they target a test of 1.1467. From there, the path toward 1.1525 opens, although reaching it without support from large players could be difficult. The ultimate target would be the 1.1545 high. If the instrument declines, I expect major buyers to take action around the 1.1340 level. If no activity is seen there, it would be wise to wait for a drop to the 1.1260 low or consider long positions from 1.1165.

Technical Outlook for GBP/USD

Pound buyers must reclaim the nearby resistance at 1.3240. Only then can they aim for 1.3290, a level that will be difficult to break above. The ultimate target would be the 1.3340 area. If the pair falls, bears will likely attempt to regain control at 1.3190. A successful break below this range would deal a serious blow to the bulls and push GBP/USD down to the 1.3130 low, with potential for an extension to 1.3080.