TOKYO- The US dollar firmed above an 11-week trough on Thursday as vague pledges from US President Donald Trump to impose tariffs on Europe and further delays to levies planned for Canada and Mexico stoked uncertainty.
The euro edged further from a one-month high of $1.0529 hit in the previous session, as traders took a wait-and-see approach to Trump floating the idea on Wednesday of a 25 percent “reciprocal” tariff on European cars and other goods.
Trump also said steep 25 percent tariffs on Mexican and Canadian goods could take effect on April 2 instead of the previously stated deadline of March 4.
But a White House official said levies on Mexican and Canadian goods remained in effect “as of this moment,” pending Trump’s review of both nations’ actions to secure their borders and halt the flow of migrants and the opioid fentanyl into the United States.
The confusion kept currencies largely within recent ranges, with the Canadian dollar under pressure near a two-week low against the greenback, while the Mexican peso hovered at 20.423 after briefly appreciating to as high as 20.286 on Trump’s remarks.
The euro slid 0.17 percent to $1.0467, with investors also awaiting news of any progress on efforts by German conservatives to form a coalition government following their election victory.
Markets appeared to be waiting for a more substantial catalyst, which Trump’s “mixed messaging” was not, said Matt Simpson, senior market analyst at City Index.
“We know that Trump can say what he wants when he wants, and only some of his threats come to fruition, which is likely why currency traders took his latest comments within stride,” he said.
