In an incredible twist of events, the US Dollar is declining in value against the Euro after President Trump launched a sweeping trade war against everyone. The EU has not retaliated against the US tariffs but French President Emmanuel Macron appealed to French businesses to halt their investments in the US.
It is often the US Dollar which is considered as the safe-haven currency, but the US Dollar is doing the unusual by declining in value while the US stock market loses value in a significant correction. The S&P 500 declined by around 7% since President Trump was elected into office.
The Euro soared up to 2.41% in value since the tariffs announcement, and other major currencies like the Japanese Yen, the Canadian Dollar and the Swiss Franc also increased in value. The British Pound and the Japanese Yen also increased in value against the US Dollar since last year. The Euro is currently valued at around $1.108 as of the time of writing.
President Trump also believes that a weaker US Dollar will help increase US exports.
On the other hand, European stock market indices have soared to all-time highs following President Trump’s initial announcements of tariffs against Europe. but have now retraced their move. Foreign capital inflow into European stocks have soared as of last year with current outflows of US stocks reaching record levels. The US stock market lost up to $2.4 trillion in value since President Trump announced his massive trade war. Inflows of capital into European stocks was also highly positive in the first quarter of this year, with Europeans also pulling out capital from US funds to redirect them into European assets.
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