Dollar loses steam after new US tariffs

The EURUSD pair climbed to around 1.0950 during the Asian session on Thursday, with the greenback edging lower against the Euro after President Donald Trump announced more aggressive-than-expected tariffs against US trading partners.

Trump plans to impose a 20% tariff on EU goods and higher duties on some of the country’s biggest trading partners, which will take effect on April 9.

European Commission President Ursula von der Leyen on Thursday slammed Trump’s imposition of tariffs on EU goods and vowed to retaliate.

Worries about the impact of an escalating global trade war and a slew of weaker-than-expected US data raise the fear of a sharp global economic slowdown in the US, which drags the USD lower broadly.

Fed Governor Adriana Kugler said on Wednesday that rising tariffs in the US could feed into more prolonged inflation than might be expected. Kugler said that she supported keeping the current interest rate steady, as long as these upside risks to inflation continue.

Traders await the US weekly Initial Jobless Claims, the final S&P Global Services PMI, and the ISM Services PMI. If the reports show stronger-than-expected outcomes, these could lift the USD and create a tailwind for EURUSD.

(Source: OANDA)