Euro Soars as U.S. Reverses Course on EU Tariffs
The euro reached a one-month high against the U.S. dollar as President Trump delayed 50% tariffs on EU imports, allowing time for a negotiated deal. This policy reversal, along with major spending bills, has weakened the dollar. Investors are turning away from U.S. assets, boosting the euro and sterling.
The euro hit a one-month peak against the U.S. dollar on Monday following President Donald Trump's decision to backtrack on a proposed 50% tariff on European Union shipments initially set for June 1. The European bloc had sought time to craft an acceptable agreement.
The reversal in U.S. trade policy, coupled with expansive fiscal measures including a spending and tax-cut bill, has cast doubt on U.S. investments, causing a slide in the dollar's value. The euro capitalized on this sentiment, gaining 0.55% to $1.1418, marking a new benchmark since late April.
European Central Bank President Christine Lagarde commented on the potential for the euro to challenge the dollar's reserve status, contingent on the strengthening of the EU's financial structures. Meanwhile, the pound also rose, while the dollar held steady against currencies like the yen and the Swiss franc.
(With inputs from agencies.)
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