Euro Falls On Tariff Concerns

The euro dropped against its most major counterparts in the New York session on Wednesday on concerns that implementation of new tariffs by the incoming Donald Trump administration could lift inflation.

CNN reported that Trump might declare a national economic emergency to enact tariff strategy.

The Federal Reserve will release the minutes of the December policy meeting later today.

Survey data from the European Commission showed that euro area economic confidence deteriorated to the lowest in more than a year in December as the improvement in services sentiment was offset by weaker morale in industry, construction and among consumers.

The economic sentiment index dropped more-than-expected to 93.7 in December from 95.6 in the previous month.

The euro touched 162.84 against the yen and 0.9372 against the franc, setting 2-day lows. The currency is seen finding support around 156.00 against the yen and 0.92 against the franc.

The euro touched 1.4792 against the loonie and 1.0272 against the greenback, reaching 5-day lows. The next possible support for the currency is seen around 1.45 against the loonie and 1.00 against the greenback.

The euro retreated to 1.8368 against the kiwi and 1.6584 against the aussie, from an early high of 1.8405 and a 6-day high of 1.6656, respectively. The currency may challenge support around 1.76 against the kiwi and 1.63 against the aussie.

In contrast, the euro climbed to 0.8352 against the pound, its highest level since November 27. If the currency rises further, it is likely to test resistance around the 0.85 region.