EUR/USD slides as Trump's EU tariff threats weigh on euro

EUR/USD has declined sharply to test 1.0800 support as currency markets react to reports of potential Trump administration tariffs on European Union exports. The euro weakened 0.5% against the dollar in early trading, with the US Dollar Index gaining strength across the board. Market participants are pricing in increased trade friction risks, which could significantly impact European export competitiveness and economic growth prospects. The tariff threats have overshadowed recent eurozone economic improvements, shifting focus to potential retaliatory measures and their impact on transatlantic trade flows. Technical indicators show EUR/USD breaking below its 50-day moving average at 1.0825, with next support at 1.0780. Should trade tensions escalate, the pair could test 1.0750 levels. Traders are advised to monitor political developments closely, as any de-escalation could trigger a swift euro recovery.