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EURUSD:
The EUR/USD pair rallied strongly on Thursday, the euro pulled up with the rest of the market as the US dollar falls on the wave of the Trump administration’s flat and “reciprocal” tariff packages unveiled this week. The pair pulled back a bit on Friday, but seems poised to continue its upward momentum.
The European part of the economic data list is relatively sparse this week, but Friday will see the release of the new US Non-Farm Payrolls (NFP) report. The NFP data could have a significant impact on markets as the US economy transitions to a post-tariff period. The March employment data is expected to serve as an “indicator” of the effects of the Trump administration’s tariff strategy.
US ISM’s US services purchasing managers’ index (PMI) data for March further dampened investor sentiment on Thursday, falling to a nine-month low of 50.8 and declining at one of the fastest rates in a month since the pandemic. Business activity and consumer confidence evaporated ahead of the Trump administration’s imposition of tariffs, and sentiment is unlikely to recover quickly once the tariffs are imposed.
U.S. President Donald Trump approved a 10 percent tariff on all imports from April 5, with calculated “retaliatory” tariffs starting April 9. According to Fitch Ratings, the U.S. economy will grow at a rate below the forecast downgraded in March. Fitch Ratings warned that the effect of Trump’s tariffs will reach the Federal Reserve (Fed), which may delay interest rate cuts while it monitors the impact of these tariffs on inflation and employment.
Trading recommendation: BUY 1.1080, SL 1.1010, TP 1.1160
Origin: FreshForex
