- EUR/USD holds a positive rationale at 1.0780 for Wednesday’s Asian session, adding 0.13% per day.
- The US CB Consumer Trust Index fell to a low point in March in four years.
- ECBS Villeroy said there is still space to cut interest rates further.
Euro Strengthens as US Dollar Softens
The EUR/USD pair advanced toward 1.0780 during Asian trading hours on Wednesday. The US Dollar (USD) weakened against the Euro (EUR) due to disappointing US economic data and ongoing uncertainty surrounding the trade policies of US President Donald Trump. Investors are closely watching the upcoming US Durable Goods Orders report for February, set to be released later in the day.
US Consumer Confidence Falls to a Four-Year Low
The US economy continues to show signs of strain, with recent data pointing to declining consumer confidence. According to the Conference Board, US consumer confidence in March fell to its lowest level in more than four years. This decline highlights growing economic uncertainty, which could further pressure the Greenback in the near term.
Market Worries Over Trump’s Tariff Plans
Investor sentiment remains cautious as concerns over Trump’s reciprocal tariff plans persist. Although the new round of tariffs is scheduled for April 2, Trump stated on Monday that not all levies would take effect on that date, and some countries might receive exemptions. However, he provided no further details, leaving markets uncertain. According to Kyle Rodda, a senior financial analyst at capital.com, “There’s an elevated baseline anxiety in the markets still ahead of next week’s trade policy announcement from the Trump administration.”
Dovish ECB Comments Limit Euro Gains
Despite the Euro’s recent gains, dovish remarks from European Central Bank (ECB) officials could cap further upside potential. On Tuesday, ECB Governing Council member François Villeroy de Galhau indicated that there is still room for additional rate cuts. He suggested that the current 2.5% deposit rate could be reduced to 2% by the end of the summer, which may put downward pressure on the EUR in the coming months.
