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The Euro<\/a> (EUR) weakens further against the US Dollar (USD) on Friday, with EUR\/USD slipping to a three-month low. The pair remains under pressure as the Greenback draws support from the Federal Reserve\u2019s (Fed) hawkish tone after delivering a widely expected 25-basis-point rate cut earlier this week<\/a>.<\/p>\n At the time of writing, EUR\/USD is trading around 1.1523, extending losses for the third consecutive day and on track to post its first monthly decline in three months.<\/p>\n Meanwhile, the US Dollar Index (DXY), which tracks the Greenback against a basket of six major currencies, is hovering near three-month highs around 99.80. The index is on course for a second consecutive monthly gain, supported by fading expectations of another interest rate cut this year.<\/p>\n As the dust settles from this week\u2019s central bank decisions, policy divergence between the Federal Reserve (Fed) and the European Central Bank (ECB) has become more pronounced. The Fed delivered a ‘hawkish’ cut on Wednesday, lowering the federal funds rate to a range of 3.75%-4.00% in a 10-2 vote.<\/p>\n The move, in line with market expectations, was accompanied by cautious guidance from Chair Jerome Powell, which tempered expectations of another rate reduction in December, a move investors had largely considered a done deal.<\/p>\n In contrast, the ECB<\/a> kept its interest rate unchanged for the third consecutive meeting, citing that inflation remains close to the central bank\u2019s 2% medium-term target and that the Eurozone<\/a> economy continues to expand despite global headwinds, supported by a resilient labor market.<\/p>\n The central bank reaffirmed its data-dependent, meeting-by-meeting approach, emphasizing that it is not pre-committing to any specific rate path and will adjust policy in line with incoming data and evolving inflation dynamics.<\/p>\n Earlier in the day, comments from Fed officials reinforced the central bank\u2019s cautious stance. Atlanta Fed President Raphael Bostic<\/a> said the Fed\u2019s mandates are \u201cin tension,\u201d adding that he supported this week\u2019s rate cut because policy remains in restrictive territory.<\/p>\n