“The euro is heading for its worst month in a year, weighed down by the prospect that US trade tariffs will hit the region’s already weakened economy.”, — write: epravda.com.ua
The euro is heading for its worst month in a year, weighed down by the prospect that US trade tariffs will hit the region’s already weakened economy. This is reported by Bloomberg. The single EU currency fell about 3% to $1.0575 in November, just below a two-year low hit earlier this month. This is the biggest monthly drop since May 2023. The euro has fallen out of favor amid investor fears that the European economy will suffer if Donald Trump imposes tariffs on US imports, potentially prompting policymakers to cut interest rates more aggressively.Advertisement: Signs of stagnant growth and political turmoil in Germany and France, the bloc’s two largest economies , also contributed to the sell-off of the currency.Advertisement: After Donald Trump’s election victory, the dollar rate sharply rose, while the euro was the worst performer among Group of 10 currencies. This is largely due to expectations that the European Central Bank will cut borrowing costs by 150 basis points by the end of 2025, roughly double what the Federal Reserve is forecasting. To recall: Three heads of EU central banks sounded the alarm over the economic downturn, warning that political paralysis makes Europe even more vulnerable in a potential trade war with the United States. The euro fell to its lowest level in two years as traders bet the European Central Bank will be forced to cut interest rates aggressively to support the region’s economy.
