EUR/USD struggles below $1.05 amid weak US data and tariff uncertainty
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Market Overview
The EUR/USD pair remains under pressure, failing to sustain gains above $1.05 as traders digest weak US consumer confidence data and concerns over Trump’s tariff policies.
Key Market Drivers
US Consumer Confidence Declines Sharply
February’s Consumer Confidence Index fell to 98.3, well below the expected 102.7 and significantly lower than January’s 105.3. A reading below 100 signals economic weakness, raising concerns over consumer spending and growth prospects.
Tariff Concerns Weigh on the US Dollar
The US dollar initially lost ground as markets reacted to Trump’s renewed tariff threats on imports from Mexico, Canada, and China. Historically, tariffs are expected to boost the local currency, but the greenback has weakened instead, confusing traders’ expectations.
Technical Outlook for EUR/USD
The euro briefly touched $1.0520 on Tuesday before retreating back below $1.05.
The pair is testing support near $1.0485, with a break lower potentially opening the door toward $1.0450.
On the upside, a sustained break above $1.0520 could push EUR/USD toward $1.0575, a key resistance level.
Market Sentiment & Upcoming Events
Traders remain cautious as trade war risks grow, with tariffs potentially leading to higher inflation and complicating the Federal Reserve’s rate policy.
Focus now shifts to upcoming US inflation data and Federal Reserve commentary, which could influence dollar momentum and determine the euro’s breakout direction.
The EUR/USD pair remains under pressure, failing to sustain gains above $1.05 as traders digest weak US consumer confidence data and concerns over Trump’s tariff policies.
Key Market Drivers
US Consumer Confidence Declines Sharply
February’s Consumer Confidence Index fell to 98.3, well below the expected 102.7 and significantly lower than January’s 105.3. A reading below 100 signals economic weakness, raising concerns over consumer spending and growth prospects.
Tariff Concerns Weigh on the US Dollar
The US dollar initially lost ground as markets reacted to Trump’s renewed tariff threats on imports from Mexico, Canada, and China. Historically, tariffs are expected to boost the local currency, but the greenback has weakened instead, confusing traders’ expectations.
Technical Outlook for EUR/USD
The euro briefly touched $1.0520 on Tuesday before retreating back below $1.05.
The pair is testing support near $1.0485, with a break lower potentially opening the door toward $1.0450.
On the upside, a sustained break above $1.0520 could push EUR/USD toward $1.0575, a key resistance level.
Market Sentiment & Upcoming Events
Traders remain cautious as trade war risks grow, with tariffs potentially leading to higher inflation and complicating the Federal Reserve’s rate policy.
Focus now shifts to upcoming US inflation data and Federal Reserve commentary, which could influence dollar momentum and determine the euro’s breakout direction.