EUR/USD Steady Above 1.1800 Despite German IFO Data

Key Moments

EUR/USD maintains levels above 1.1800 in the first half of Monday’s European session after trimming part of its intraday advance.
Germany’s February IFO Business Climate Index rises to 88.6 from 87.6, but the survey generates limited support for the Euro.
Renewed trade-policy uncertainty and expectations for at least two additional 25 bps Fed cuts pressure the USD and underpin EUR/USD.

Euro Edges Higher But Momentum Fades

EUR/USD extends its upward bias for a second consecutive day, but the move lacks strong follow-through. After advancing earlier in the session, the pair gives back part of its intraday gains, yet continues to trade above the 1.1800 handle during the first half of the European session on Monday.

The currency pair shows little reaction following the latest business survey from Germany’s IFO institute for February, suggesting that broader macro and policy themes remain the primary drivers for now.

German IFO Survey Improves, But Fails to Lift the Euro

The headline IFO – Business Climate Index inches higher to 88.6 in February from 87.6 a month earlier, while the Current Assessment Index improves to 86.7 from 85.7. Despite the better readings, the release does not deliver a meaningful boost to the common currency.

Lingering uncertainty regarding European Central Bank (ECB) President Christine Lagarde’s tenure, together with renewed concerns about possible trade conflicts, appears to overshadow the modest improvement in German business sentiment.

IFO Business Climate – Latest Data

Economic Indicator	Last Release	Frequency	Actual	Consensus	Previous	Source
IFO – Business Climate	Mon Feb 23, 2026 09:00	Monthly	88.6	88.4	87.6	IFO Institute

Trade Policy Tensions and Fed Expectations Pressure the Dollar

Trade-policy developments in the United States remain a central theme for FX markets. US President Donald Trump imposed a new global levy of 15% after a Supreme Court verdict on Friday against his earlier broad reciprocal tariffs. In reaction, the European Parliament’s trade chief indicated that the European Union (EU) will move to suspend the ratification process for the trade deal with the US until it receives clarity from the Trump administration on its trade approach.

These developments revive the so-called “Sell America” trade, intensifying pressure on the US Dollar. At the same time, market expectations for at least two additional 25 basis points (bps) rate reductions by the US Federal Reserve (Fed) further weigh on the USD, providing a supportive backdrop for EUR/USD.

Even so, the absence of decisive follow-through buying in the pair suggests investors remain cautious about chasing further upside without clearer confirmation from data or policy signals.

About the IFO Business Climate Index

This German business sentiment indicator, compiled by the CESifo Group, is widely monitored as an early gauge of current conditions and near-term expectations in the German economy. The survey covers more than 7,000 enterprises, asking for assessments of the prevailing business situation and short-term planning. Stronger readings are generally interpreted as supportive for the Euro, while weaker outcomes are viewed as negative for the currency.