Euro on course for weekly gain; U.S. tariffs hit Canadian dollar, peso

The euro seemed set to post its first weekly gain in seven weeks on Friday as worries over Italy’s political crisis eased, but the Canadian dollar and Mexican peso were looking frail after Washington went ahead with stiff tariffs on imported steel.

The euro traded at $1.1692 (EUR=), little changed on the day but keeping intact its recovery from Tuesday’s 10-month low of $1.1510.

So far this week it is up 0.4 percent after six straight falling weeks, hit by signs of slowdown in the euro zone economy and political instability in Italy and Spain.

But Italy’s borrowing costs fell sharply for the last two days as the country’s efforts to form a coalition government are back on track.

Asian Equities Mixed; U.S. Tariffs Revive Trade War Fears

Asian equities were mixed in afternoon trade on Friday. The U.S. refused to exempt its allies from tariffs, reigniting fears of a global trade war. The uncertainty hampered market confidence and sent Greater China stocks down, while a weaker yen sent Nikkei higher and South Korea’s KOSPI was supported by firm export data.

Reports that the administration of U.S. President Donald Trump surprised partners and allies Thursday by refusing to extend a reprieve on tariffs on imported steel and aluminium took centre stage. This came only days after headlines on the Italian political turmoil affected the global markets.

The announcement means the EU, Canada and Mexico would be soon subject to tariffs. Meanwhile, Trump was threatening more tariffs on other imported products, including European cars.