The US Dollar experienced subdued price action following the release of disappointing US Retail Sales data on Friday. This development set the tone for a quiet Monday, as GBP/USD stayed in a range near 1.2600 during the early European session. Meanwhile, EUR/USD faced challenges in capitalizing on recent gains, oscillating narrowly below 1.0500. With US markets closed for Presidents' Day, thin trading volumes were expected to persist, contributing to a generally upbeat market mood.
The economic landscape under the Trump administration is beginning to solidify, with recent tariff impositions on certain American trading partners. Additional tariffs are anticipated, likely prompting foreign retaliation. These developments have generated concerns over potential impacts on global trade dynamics. Despite these uncertainties, market participants remained focused on the currency pairs' performance, with the US Dollar's weakness showing persistence.
President Trump's trade policies continue to influence market expectations, as investors brace for further tariff announcements. The potential for foreign retaliation adds another layer of complexity to the evolving trade environment. Amid these policy shifts, currency markets maintained a steady course, exhibiting resilience despite external pressures.