The US dollar faced renewed pressure in Asian trading after President Donald Trump threatened tariffs on European nations tied to his plan to acquire Greenland, Bloomberg reported. The Bloomberg Dollar Spot Index fell 0.1 percent, while Treasury futures traded mixed and cash markets were closed for a US holiday.

European currencies found support in the wake of the news, with the Swiss franc outperforming its Group-of-10 peers amid higher demand for haven assets. The euro recovered from a near two-month low, reflecting a cautious shift in investor sentiment.

Analysts warned that the tariff threats could weigh on the eurozone economy. Bloomberg cited concerns that potential tariffs may intensify cyclical headwinds and reduce pressure on Russia to end its war in Ukraine.

David Forrester, senior strategist at Credit Agricole CIB in Singapore, told Bloomberg that Trump’s actions have rekindled the “sell America” trade. He added that the market would be watching for the so-called “TACO trade,” suggesting that the president may be using tariff threats as leverage in negotiations, which could provide some support for the US dollar.