The imposition of a fixed 25% tariff on all steel and aluminum imports, set to take effect on April 2, has raised concerns among investors that the global trade war could escalate further.

Meanwhile, the European Union (EU) has announced retaliatory measures by imposing import tariffs on U.S. goods. This move increases the risk of a trade war between the EU and the U.S. and may support the U.S. dollar as investors seek safer assets.

However, investors anticipate that the Federal Reserve may cut interest rates by at least 25 basis points twice before the end of the year. Meanwhile, they are awaiting additional economic data, particularly the Q4 GDP report, which could help forecast the Fed’s rate cut decisions.

Source: Fxstreet