EUR/USD remains stronger near 1.1750 as US Dollar weakens, Germany's ZEW index surges

EUR/USD extends its gains for the third consecutive session, trading around 1.1730 during the Asian hours on Wednesday. The pair appreciates as the US Dollar (USD) continues to lose ground amid rising United States (US)–Greenland concerns.

US President Donald Trump said there is “no going back” on his ambitions regarding Greenland, alongside earlier threats to impose new 10% tariffs on eight European Union (EU) countries, fuelling concerns over slower economic growth. Additionally, Trump threatened a 200% tariff on French wines as President Emmanuel Macron refrained from joining Trump's "Board of Peace".

The European Parliament plans to suspend approval of the US trade deal agreed in July, with the decision set to be announced on Wednesday in Strasbourg, France. An escalation in US–Europe tensions.

The downside of the Greenback could be restrained as the latest US labor market data have pushed back expectations for further Federal Reserve (Fed) rate cuts until June. Fed officials have signaled little urgency to ease policy further until there is clearer evidence that inflation is sustainably moving toward the 2% target.

The Euro (EUR) receives support against its peers despite increased risk aversion, supported by stronger-than-expected German economic data. Germany’s ZEW Economic Sentiment Index surged to 59.6 in January, its highest since July 2021 and well above the 50 forecast, signalling optimism for a 2026 economic turnaround despite uncertainty over US trade policy.