ECB Rate Cut Expected as EU Unveils €800B Defense Plan

The euro neared $1.08, a four-month high, as increased defense spending and borrowing strengthened Eurozone optimism. Germany’s CDU/CSU and SPD agreed to exceed 1% of GDP in defense spending and create a €500 billion off-budget fund. EU plans to mobilize €800 billion for defense, with €150 billion in loans and more fiscal flexibility. The ECB is expected to cut rates for the fifth time this week.

Key resistance is at 1.0840, followed by 1.0900 and 1.0950. Support stands at 1.0760, with further levels at 1.0700 and 1.0650.