EUR/USD trades back below 1.0800, still with bullish development on European session Thursday. The currency pair keeps its recovery from three-week lows intact, supported by a comeback in US Dollar weakness. This trend unfolds as traders closely monitor economic developments, particularly the fresh tariff threats from US President Donald Trump that have heightened concerns about a potential slowdown in the US economy.
In Thursday’s European morning session, EUR/USD showed a bullish impulse, holding above 1.2900. The duo’s fall is at least in part due to the market’s reaction to the recent trade-positive tariff announcements by President Trump. These demands have led even more sellers to exchange the US Dollar. The short term consequence is the strengthening the euro, as it moves up from recent lows.
The US Dollar’s current weakness can be linked to traders’ anxiety over the economic implications of the proposed tariffs. Yet, as these worries continue to mar the bloc, the euro has rallied to make up lost ground versus its U.S. rival. The EUR/USD’s strength mirrors this reality, with the currency pair only giving ground against its US counterpart as the situation continues to change dramatically on the geopolitical front.
Even though trading below the key 1.0800, the EUR/USD has showed strength doing so, holding on to its recent rise. The key to this encouraging turn of events has been the intensifying selling pressure on the US Dollar. Market participants are still trying to digest the potential fallout from the tariff announcements, and re-positioning themselves.
As of Thursday morning in Europe, the EUR/USD is still trading solidly above 1.2900, indicating a very strong positive bias. Market faith in the euro is returning. She calls these contours of the euro a symptom of global dollar weakness and associated uncertainty stemming from recent episodes of US domestic policy change, emanating from Washington, DC.