The euro traded near $1.09 after declining for two consecutive sessions. This holding pattern reflects investor uncertainty as they await clarification on the EU’s strategy for managing U.S. tariffs, amidst broader market concerns about global growth and escalating trade tensions pushing investors away from riskier currencies.
- The European Commission proposed a zero-for-zero tariff deal to the U.S. to avoid a trade war, but it was rejected.
- The EU also proposed counter-tariffs of 25% on certain U.S. goods in response to U.S. tariffs on steel and aluminum.
- Escalating trade tensions between the U.S. and China are also influencing market sentiment.
The described circumstances indicate a period of vulnerability for the euro. Its value is being heavily influenced by external factors, specifically global trade disputes. The stability of the currency depends on the EU’s ability to effectively navigate these challenges and the broader trajectory of international trade relations.