EUR/USD Takes a Turn Towards 1.1065 as Tariff Impact Resonates Ahead of FOMC Minutes

Lead

　　The EUR/USD currency pair attracts buyers, rising to 1.1065 during the early European session on April 9, 2025, following the implementation of new tariffs by U.S. President Donald Trump and amid anticipation of the release of FOMC Minutes that will shed light on future U.S. monetary policy direction.

　　Main Body

　　On Wednesday, the EUR/USD pair experienced a notable increase, reaching approximately 1.1065 in early European trade. This uptick occurred in the context of a weaker U.S. Dollar (USD) against the Euro (EUR), largely attributed to the newly imposed reciprocal tariffs by President Trump that came into effect within the same day. The ongoing global trade tensions, along with the associated fears of an impending recession propelled the pair higher, supporting bullish sentiment among traders.

　　President Trumps recent tariff strategy includes significant increases on imports from 86 countries, with rate hikes ranging from 11% to 84%. This policy action has heightened concerns over the potential for a recession, as it threatens to disrupt global trade dynamics and economic stability. As fears of recession loom, the dollar has faced downward pressure, creating a favorable environment for the Euro to strengthen.

　　In addition to the tariffs, the market is closely watching for insights from the Federal Reserve's FOMC Minutes, scheduled for release later in the day. These minutes are expected to provide crucial indications about the Fed's current economic outlook and potential future policy adjustments. Traders are particularly keen to hear commentary from Fed officials, including William Thomas Barkin, who is speaking later in the session.

　　Currently, speculation is rising regarding a possible interest rate cut from the European Central Bank (ECB) in the upcoming meetings, with analysts suggesting a nearly 90% probability of a 25 basis point cut at the ECB's next meeting on April 17. This sentiment is largely driven by the belief that Trump's tariff impositions could accelerate downturns in the Eurozone economy, amplifying the ECBs inclination to ease monetary policy to mitigate the effects. This anticipated easing aligns with the political and economic landscape, where the ECB may need to further examine its rate policies in light of prevailing market conditions.

　　As the economic calendar progresses, it reveals varying probabilities influencing market sentiment. The FOMC Minutes from previous meetings have often affected trading patterns in the forex market significantly, contributing to fluctuations in the currency values based on perceived hawkish or dovish tones from committee members. This time, investors are particularly alert to any shifts in policy guidance with regard to ongoing interest rate adjustments.

　　Amid trading, analysts note the importance of monitoring the 1.1050 level for EUR/USD as a key psychological barrier. Should the pair sustain momentum above this threshold and push past 1.1065, it may pave the way for further advances toward higher resistance levels. However, the potential for volatility remains pronounced in light of the prevailing uncertainties surrounding global trade and the outcomes from the FOMC Minutes release.

　　Conclusion

　　In summary, the EUR/USD currency pair is currently rallying above the 1.1050 mark following the implementation of new tariffs by the U.S., coinciding with heightened concerns about potential economic downturns. The upcoming FOMC Minutes are anticipated to provide crucial insights into future U.S. monetary policy directions. As global trade tensions continue to loom, both currencies remain at the mercy of market sentiment and economic indicators, which will be closely monitored by forex investors in the days to come.

　　Sources

• Federal Reserve. (2024). Minutes of Federal Open Market Committee Meetings. Retrieved from Federal Reserve Minutes
• Bloomberg. Data on ECB Interest Rate Odds.
• TD Economics. U.S. FOMC Meeting Minutes Analysis.
• StoneX. Understanding FOMC Minutes.