On Wednesday, EUR/USD is once again losing the ground it gained against the US dollar on Tuesday. The European currency is under pressure from both rising oil prices and a stronger dollar against a basket of currencies ahead of the expected release of the Federal Reserve meeting minutes. Even the optimistic German industrial production data failed to support the euro.

According to data provided by the Federal Statistical Office of Germany, industrial production in the country increased by 2% in September, almost completely offsetting the 1.2% decline in August and significantly exceeding the forecast of 0.5% growth. On an annual basis, production increased by 2.3% after falling by 1.6% in the previous month.

Nevertheless, markets ignored these positive figures as cautious sentiment and risk aversion prevail. A new escalation of tensions in the Middle East is once again pushing oil prices higher. The price of a barrel of Brent crude has returned above the psychologically important $100 level, putting significant pressure on economic growth in the euro area.

On Tuesday, the euro received a slight boost following a statement by Marine Le Pen, a representative of the right-wing political forces and a leading candidate in next year's presidential election, regarding plans to reduce government spending. Le Pen pledged to cut government spending by €140 billion over the next five years and reduce the budget deficit to 3% by 2030, from the current 5.1%. This plan is giving investors greater confidence: the yield on French government bonds has declined from multi-year highs, while EUR/USD rose toward the upper boundary of the 1.1200 range, recovering after falling to 17-month lows of around 1.1160 recorded on Monday.

Meanwhile, Wednesday brought stability to the US dollar as it recovered against most other currencies, with investors preparing for the release of the minutes of the September Federal Open Market Committee (FOMC) meeting scheduled for today. Recall that over the past three years, the Fed raised its interest rate by 25 basis points for the first time, while hinting at the possibility of further monetary policy tightening.

Moderate inflation and US labor market data have prompted market participants to scale back their expectations for another rate hike in October. Overall, however, the US economy remains stable, while inflation is significantly above the Fed's target. This supports market expectations, according to CME's FedWatch Tool, that the regulator will raise rates again in December and possibly once more in the first quarter of 2027.

From a technical perspective, the pair is attempting to hold above 1.1200. At the same time, the oscillators are negative, confirming the bears' advantage in the market. However, the Relative Strength Index (RSI) has moved into oversold territory, creating room for a correction. The 1.1260–1.1285 level remains resistance. The October low now serves as support.