Euro gains as investors cautiously welcome US-EU – Money News
By Caroline Valetkevitch and Lewis Krauskopf
NEW YORK (Reuters) -Investors cautiously embraced information of a commerce deal on Sunday between the U.S. and European Union that’s anticipated to convey readability for corporations and a few certainty to markets forward of U.S. President Donald Trump‘s Friday tariffs deadline.
The euro rose towards the U.S. greenback, up 0.27% at $1.177. The currency additionally gained 0.2% towards each the pound and the Japanese yen.
Trump introduced the United States has struck a framework commerce deal with the EU that features a 15% tariff on EU items coming into the U.S. and important EU purchases of U.S. power and army gear.
European Commission President Ursula von der Leyen mentioned the deal consists of “cars, semiconductors and pharmas.”
The deal is much like elements of the framework settlement the U.S. clinched with Japan final week.
“It’s really in line with the Japan deal, and I assume investors will view it positively as they viewed the Japan deal,” mentioned Rick Meckler, companion at Cherry Lane Investments in New Vernon, New Jersey.
Optimism over easing commerce tensions broadly helped push U.S. shares to file highs final week and lifted European shares to their highest since early June.
Trump’s April 2 “Liberation Day” announcement of sweeping international tariffs despatched shares plunging within the rapid aftermath, as a result of spiking fears about a recession which have since light.
“I don’t think equities in particular needed much of an excuse to rally and now they’ve got one,” mentioned Michael Brown, senior analysis strategist at Pepperstone in London.
Still, investors have been bracing for elevated volatility heading into August 1, which the U.S. has set as a deadline for raising levies on a broad swath of trading companions.
“We will need to see how long the sides stick to the deal. From a market perspective, it is reassuring in the sense that having a deal is better than not having a deal,” Eric Winograd, chief economist at investment management firm AllianceBernstein, mentioned concerning the EU settlement.
The announcement got here after Von der Leyen traveled to Scotland for talks with Trump to push a hard-fought deal over the road.
(Reporting by Lewis Krauskopf and Caroline Valetkevitch; further reporting by Lucy Raitano in London and Matt Tracy in Washington DC; enhancing by Alden Bentley, Edward Tobin, Amanda Cooper, Nick Zieminski and Marguerita Choy)
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