FX.co ★ Euro Rises on US-EU Trade Pact

The euro surged above the $1.175 mark on Monday, recovering from a two-day decline following the announcement of a trade deal between the United States and the European Union over the weekend. This agreement imposes a 15% tariff on most European products, significantly less than the 30% initially threatened by Washington, thereby alleviating concerns regarding a wider trade dispute. Unveiled in Scotland on Sunday by President Trump and European Commission President Ursula von der Leyen, the agreement was praised by Trump as "the biggest of all the deals," while von der Leyen noted it would bring "stability" and "predictability." Nevertheless, crucial details, such as the specific industries involved and potential exemptions, remain undetermined. The previous week, the euro appreciated by 1% after the European Central Bank (ECB) maintained interest rates, opting to pause and evaluate geopolitical risks. This comes after the ECB executed four rate cuts this year, reducing the deposit rate from a 4% high in 2024 to 2% by June.