A comprehensive investigation into the United States' trade relationships has been launched following a memorandum issued by the Trump administration. President Donald Trump warned that tariffs are looming over the European Union, signaling potential trade tensions. The announcement is part of a broader strategy that includes the unveiling of a "Stargate" project, a $500 billion investment aimed at enhancing the United States' artificial intelligence infrastructure.
The Stargate project will kick off with an initial $100 billion investment, ultimately scaling up to $500 billion. This initiative aims to establish cutting-edge data centers and infrastructure in Texas, positioning the U.S. as a leader in AI technology. Meanwhile, nations such as China, Canada, and Mexico find themselves under scrutiny as potential targets for immediate U.S. trade actions.
In financial markets, the U.S. Dollar experienced a rebound following President Trump's tariff threats. The EUR/USD currency pair battled around the 1.0400 mark during European trading hours on Wednesday. This struggle reflects the resurgent demand for the U.S. Dollar as a safe-haven asset amidst escalating trade war fears under the Trump administration.
Traders are closely monitoring these developments, as the prospect of a trade war looms large. The dovish stance of the European Central Bank (ECB) also contributed to the pressure on the EUR/USD pair, intensifying market volatility.