Euro slips after Trump threatens 30% tariffs on EU – Money News
By Rae Wee
SINGAPORE (Reuters) -The euro fell to a three-week low early on Monday whereas the Mexican peso additionally got here beneath stress after U.S. President Donald Trump threatened to impose a 30% tariff on imports from two of the biggest U.S. trading companions starting August 1.
Trump on Saturday introduced the most recent tariffs in separate letters to European Commission President Ursula von der Leyen and Mexican President Claudia Sheinbaum that had been posted on his Truth Social media web site.
Both the European Union and Mexico described the tariffs as unfair and disruptive, whereas the EU mentioned it will lengthen its suspension of countermeasures to U.S. tariffs till early August and proceed to press for a negotiated settlement.
Reaction within the currency market to Trump’s newest tariff threats was largely muted in Asian commerce, although the euro did slip to a roughly three-week low early within the session.
The single currency later regained some ground and final traded 0.12% decrease at $1.1679.
Against the Mexican peso, the greenback rose 0.25% to 18.6699.
Elsewhere, nevertheless, the greenback made restricted features, with sterling down simply 0.07% at $1.3481, whereas the Japanese yen rose 0.1% to 147.28 per greenback.
Investors have grown more and more desensitised to Trump’s slew of tariff threats, together with his newest upheaval within the world commerce panorama doing little to forestall U.S. shares from scaling report highs and offering simply a slight enhance to the greenback.
“It seems like financial markets have become insensitive to President Trump’s tariff threats now, after so many of them in the past few months,” mentioned Carol Kong, a currency strategist at Commonwealth Bank of Australia.
“Judging by the limited market reaction, markets might think that the latest threat from Trump is actually a manoeuvre to extract more concessions.”
In different currencies, the Australian greenback fell 0.14% to $0.6565, whereas the New Zealand greenback slid 0.4% to $0.5984.
Outside of tariff information, Trump on Sunday mentioned that it will be a “great thing” if Federal Reserve Chair Jerome Powell stepped down, again threatening to undermine the central bank’s independence as he referred to as for rates of interest to be lowered.
Traders might get a higher clue on the longer term path for U.S. charges when inflation information for June comes due on Tuesday, the place expectations are for U.S. client costs to have picked up barely final month.
Markets are at present pricing in simply over 50 foundation factors price of Fed easing by December.
In Asia, information on Monday confirmed China’s exports regained momentum in June whereas imports rebounded, as exporters rushed out shipments to capitalise on a fragile tariff truce between Beijing and Washington forward Trump’s August deal deadline.
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