The euro gave up its gains from Friday on Monday.
Signs of easing in the recently flared up tariff dispute between the United States and China supported the US dollar. The European common currency, the euro, fell to $1.1558. It most recently cost $1.1570 in New York trading. The European Central Bank had set the reference rate at 1.1569 (Friday: 1.1568) US dollars, which means the dollar cost 0.8643 (0.8644) euros.
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On Friday, the euro rose above the $1.16 mark as a result of new tariff threats from Trump towards China. Following a renewed escalation in the trade conflict between the world’s two largest economies, Trump wrote on the Truth Social platform on Sunday: “Don’t worry about China, everything will be fine.” Trump announced on Friday that he would increase tariffs on imports from China by a further 100 percent starting November 1st.
“So far, the damage caused by the erratic US policy has been limited. However, the negative effects, particularly on the willingness of US companies to invest, are likely to be overshadowed by the current AI boom,” commented Thu Lan Nguyen, foreign exchange expert at Commerzbank. “But it’s important to realize this: The biggest poison for the US economy is not the tariffs themselves, but the uncertainty about how high they will be and who they might affect.”
Meanwhile, uncertainty in France continues. The country does have a new government under Prime Minister Sébastien Lecornu, who has been brought back into office. France’s left-wing party La France Insoumise (LFI) and the right-wing Rassemblement National (RN) have already announced a motion of no confidence.
NEW YORK (dpa-AFX)
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