Catenaa, Tuesday, July 29, 2025- The US dollar surged Monday against major currencies after President Donald Trump and European Commission President Ursula von der Leyen announced a framework trade deal that helped ease fears of a global trade war.
The agreement, reached Sunday, will implement a 15% tariff on European Union goods, half the rate originally threatened by the White House, beginning August 1.
The move follows a similar accord between the US and Japan and coincides with renewed negotiations between US and Chinese officials in Stockholm aimed at averting further tariff hikes ahead of an August 12 deadline.
Markets responded swiftly. The euro dropped 1.25% to $1.1591, its steepest daily loss since mid-May, while the dollar climbed to 148.535 yen, up 0.59%. Against the Swiss franc, the greenback gained 1%, trading at 0.80325.
Despite a muted session on Wall Street, with the Dow down 0.3% and the S&P slipping 0.15%, currency traders are watching central banks closely.
The Federal Reserve and Bank of Japan are both expected to hold interest rates steady this week, but investor attention is squarely on their forward guidance.
Meanwhile, cryptocurrencies edged lower. Bitcoin fell 0.52% to $118,205, and Ethereum dropped 0.61% to $3,800.
The euro also slipped against the pound and yen, surrendering recent highs. Analysts now see the dollar regaining strength after months of pressure tied to US trade policy.
