10.04.202511:09:53UTC+00Euro Soars on Relief from Tariff Pause

The euro continued its upward trajectory, nearing the $1.11 threshold and marking its highest point since late September 2024. This surge was fueled by the European Union's announcement of a 90-day suspension on new tariffs against the U.S., facilitating upcoming trade negotiations. This development followed President Trump’s decision to lower tariffs on countries that refrained from retaliating against his initial trade measures, reducing them to 10%, while simultaneously increasing tariffs on Chinese imports to 125% from the previous 104%. Although the announcement helped mitigate fears of a global economic downturn and inflationary pressures, it also introduced a layer of uncertainty that could linger for several months. As a result, money markets adjusted their forecasts regarding European Central Bank rate cuts, now projecting an ECB deposit facility rate of 1.8% by December, compared to the 1.65% forecast on Wednesday and 1.9% the previous week. Additionally, the likelihood of an April rate cut decreased to 90%, down from a certainty just the day before.