EUR/USD trades with mild gains near 1.0450 in Wednesday’s Asian session.
Trump floated 25% tariffs on US auto, drug and chip imports.
Eurozone ZEW Economic Sentiment Index jumped to 24.2 in February vs. 24.3 expected.
The EUR/USD pair posts modest gains to around 1.0450 during the Asian trading hours on Wednesday, bolstered by the weakening of the US Dollar (USD). However, tariff concerns and tense Russia-Ukraine negotiations might boost the Greenback, a safe-haven currency, and cap the upside for the major pair.
US President Donald Trump said late Tuesday that he would likely impose tariffs on automobile, semiconductor and pharmaceutical imports of around 25%, with an announcement coming as soon as April 2.
Ukraine President Volodymyr Zelenskiy said no peace deal could be made for the time being. He postponed his visit to Saudi Arabia planned for Wednesday until March 10 to avoid giving "legitimacy" to the US-Russia talks. The uncertainty, geopolitical tensions and tariff threats could lift the USD and act as a tailwind for the pair.
Investors await the release of the FOMC Minutes for the January meeting, which are due later on Wednesday. This report could offer some hints about how policymakers are weighing the risk of a global trade war.
Across the pond, the Eurozone ZEW Economic Sentiment Index came in at 24.2 in February versus 18.0 prior, missing the estimation. The rising bets that the European Central Bank (ECB) will further cut the interest rates three times this year might weigh on the Euro (EUR).
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