Euro Slips As Fresh Tariff Weigh

Fundamental Analysis

* Tariff Drag: The euro weakened against the dollar, slipping below 1.0400 for the first time in nearly two weeks as concerns over potential U.S. tariffs on European goods continued to pressure the currency. Just hours after confirming that the proposed tariffs would take effect in April, U.S. President Donald Trump unexpectedly shifted course on the timing of import taxes targeting key U.S. trade partners. Trump stated that tariffs on Canada and Mexico would proceed as planned on March 4, while additional levies on European goods remain scheduled for early April. Trump also took to social media to criticize Europe’s trade practices, suggesting that European VAT taxes function as tariffs against U.S. goods. His remarks reinforced expectations of further “reciprocal” tariffs on EU imports. Meanwhile, robust U.S. economic data further weighed on the euro’s appeal. GDP growth reached 2.4% quarter-over-quarter, surpassing the 2.2% forecast, while the annualized rate held steady at 2.3%.

Technical Analysis

*Technical Breakout: EURUSD was traded lower while currently testing the support level 1.03850. MACD which illustrate bearish momentum signal suggest the pair to likely extend its losses.

* Resistance and Support: : If the bearish momentum persists, there’s a strong likelihood that the price will potentially head towards the level 1.03100. Conversely, a potential reversal is also to be expected and the price could head back towards the level 1.04550.

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Potential Risks

Looking ahead, traders will closely monitor the upcoming Core PCE Price Index, a key inflation gauge, for further market direction.

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Monitoring

Stay updated on US and Eurozone data, global market updates, central bank updates and any shifts in the US Dollar’s strength by following PU Prime’s market insights and daily financial news.

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Disclaimer: Trading derivatives involves high risks, and market conditions can change rapidly. The content is for informational purposes only and should not be considered as financial advice. Traders should conduct their own research and consider risk management strategies.