EUR/USD erases gains, back around 1.2260

• The pair climbed above 1.2280 during Asian trading hours.
• Risk-off sentiment persists on a potential ‘trade war’ after Trump’s comments.
• EMU’s producer prices and US U-Mich index next on tap later.

The European currency managed to grab some buying attention at the end of the week and pushed EUR/USD above 1.2280 in early trade, although the up move lacked of follow through.

EUR/USD looks to risk trends

After bottoming out in multi-week lows around 1.2170 on Thursday, spot met some fresh buyers and advanced to the proximity of 1.2300 the figure earlier today amidst increasing risk-off trade on the likelihood of a ‘trade war’ following comments by President Trump.

In fact, President Trump announced yesterday the US will likely impose tariffs on imports of steel and aluminium. The measure is seen having a bigger impact on Asian economies than the euro area, and forced the greenback to retreat from recent tops vs. its main rivals, particularly JPY and EUR.

In the meantime, spot regained some ground lost although it is so far on the way to close the second consecutive week with losses, all amidst the renewed buying interest around the buck in response to the hawkish tone from Powell and auspicious US data releases.

Data wise today, Producer Prices are only due in Euroland along the speech by ECB’s Y.Mersch. Across the pond, the final reading of the U-Mich index will be the lone release later today.

EUR/USD levels to watch

At the moment, the pair is losing 0.02% at 1.2262 and a breach of 1.2155 (low Mar.1) would target 1.2094 (high Sep.8 2017) en route to 1.1916 (2018 low Jan.9). On the upside, the immediate hurdle is located at 1.2293 (10-day sma) seconded by 1.2328 (21-day sma) and then 1.2356 (high Feb.26).