The dollar hovered near a five-month low against the euro due to investors’ concerns over US President Donald Trump’s protectionist trade policies. The euro rose 0.3% to $1.0914, as traders re-evaluated their expectations of Trump’s economic impact.
In January, Trump took office and declared tariffs on trading partners, causing market uncertainty. Treasury Secretary Scott Bessent said there were “no guarantees” against a recession in the US, while analysts at Societe Generale revised their currency forecasts due to Germany’s fiscal deal and Japan’s escape from deflation.
The euro strengthened after German parties agreed on a fiscal deal that could boost defense spending and revive growth. Analysts forecast the euro will reach $1.13 by year-end, up nearly 4% from current levels. The yen also rose, with the Bank of Japan expected to keep interest rates steady in its upcoming meeting.
Meanwhile, China’s yuan edged back towards its strongest level in four months after announcing a “special action plan” to boost domestic consumption. Bitcoin remained flat at $83,205 in cryptocurrencies.
Source: https://www.cnbc.com/2025/03/14/dollar-steadies-as-investors-pause-for-breath-yen-and-sterling-soften.html