The euro continues to decline despite European policymakers insisting on further rate hikes in the eurozone.

"The European Central Bank must lift borrowing costs further to bring inflation back to its target level," said Bostjan Vasle, a member of the Governing Council. "Further interest rate hikes will be needed, but the pace of increase will be slower than in the past. We are approaching the level of rates that's restrictive enough to bring inflation back toward 2%."

Vasle has joined several other members of the ECB's Governing Council who are calling for further rate hikes, at least until the beginning of this autumn. They expect at least a couple of quarter-point increases in June and July, which would conclude the most intensive period of monetary policy tightening in the euro era.

Bostjan Vasle, who heads the central bank of Slovenia, also stated that curbing inflation cannot be achieved without a coordinated approach to economic policy. "Fiscal policy, including wage policy, and monetary policies will have to be linked to a greater extent than in the past."

As mentioned earlier, Vasle is not the only one who shares this view. Bundesbank President Joachim Nagel will also deliver a speech today. In a recent interview, Nagel noted that the ECB will need further interest rate hikes to bring inflation under control. "The tightening cycle is not yet complete. We will need at least a few more rate increases to reach a sufficiently restrictive level. And then we will have to maintain this level for a significant period of time until inflation subsides."

Similar thoughts can be expected by Nagel today. However, lately, the statements by European policymakers have done little to support the euro, which is actively losing ground against the US dollar amid concerns over the possibility of a default due to issues with raising the US debt ceiling.

Yesterday, Fitch Ratings placed the "AAA" credit rating of the United States on negative watch. This has led to increased concerns about the country's ability to avoid its first-ever default. A similar situation occurred during the debt ceiling crisis in 2011. However, Fitch stated that they still expect the debt limit issue to be resolved by June 1st.

As for the technical outlook for EUR/USD, the euro remains under selling pressure. To regain control of the market, bulls need to fight back at 1.0715 and open positions at 1.0760. This will open the way towards the upper target at 1.0790. From there, the price may head for 1.0840 if supported by strong fundamental data in the eurozone. In case of a decline, large market players may step in only at the level of 1.0715. If nothing happens at this level, it would be wise to wait until the price retests the low of 1.0670. Otherwise, long positions can be opened at 1.0630.

Regarding GBP/USD, the pound stays under pressure as well. The instrument may rise only if bulls assert their strength at 1.2360. A breakout of this level may take the price higher to 1.2410. Only then a surge towards 1.2460 will be possible. If the pair depreciates, bears will attempt to regain control over 1.2320. If so, a breakout of this level will trigger stop-loss orders set by the bulls and push the pair to the low of 1.2275, with a possible decline to 1.2230.