- The US Supreme Court has overturned most of the tariffs.
- Disappointing data from the US economy impacts EUR/USD.
- The pair has consolidated within 1.18.
On Friday, the US Supreme Court ruled that the tariffs former President Donald Trump had put in place under the International Emergency Economic Powers Act were illegal. Despite this major decision, the US dollar and forex markets, including key pairs like . have only moved a little, and an early drop in the US dollar has been reversed.
Trump reacted strongly in his statements, but it is still unclear how the ruling will affect existing trade deals and future talks. On the same day, economic data from the United States came in much weaker than expected, but that does not yet mean the economy is collapsing, especially after a recent run of strong reports. At the same time, worries about a possible US strike on Iran remain and could influence markets if it happens, so these two big unknowns continue to weigh on investors.
What Next After the US Supreme Court Ruling?
The US Supreme Court ruling creates a setback for Trump and his broader trade agenda, which aims to reshape parts of the global economic order. However, the decision appears to challenge the legal route used to impose tariffs under the IEEPA, rather than the tariffs themselves. This means the current administration may look for other legal options to keep its tariff policy in place, as Treasury Secretary Scott Bessent has already suggested.
This helps explain why currency markets showed only a limited reaction. Investors seem to believe the ruling will slow the process, but will not fully dismantle the tariff strategy.
Trump responded sharply on social media, warning countries against using the court’s decision to question existing trade agreements and describing the ruling as shameful.
At the same time, the European Union has once again paused the implementation of its trade agreement with the US. As a result, trade policy is likely to stay at the center of business and market headlines in the days ahead.
One-Off Setback or Early Recession Signal? Weak GDP Raises Questions
Beyond the Supreme Court decision, the key focus for financial markets was fresh data from the US economy. The annualized growth rate came in at 1.4 percent quarter on quarter, well below expectations.
This marks the weakest reading and the first downside surprise since June last year. One soft data point alone does not signal an economic slowdown, but investors will pay close attention to the next releases, especially if the pattern continues.
EUR/USD Awaiting Momentum
After the downward trend on EUR/USD slowed down in the region of 1.1750, the main currency pair found itself in at least a local consolidation range of 1.1750-1.1830. We are therefore in a phase of relative equilibrium, awaiting further developments, which will depend primarily on the direction of the breakout.
If the price breaks lower, the next target sits near the round level of 1.17. If it moves higher, the path opens toward 1.1930, which marks this month’s peak.
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