- May 26, 2025
- Posted by: Melanie Scott
- Category: Market News
Global markets were rattled on Friday after President Trump threatened to impose 50% tariffs on all European Union imports starting June 1, rekindling fears about the economic toll of aggressive U.S. trade policies. However, those fears eased on Sunday when Trump postponed the tariff threat to July 9, helping risk sentiment rebound. The euro climbed to a one-month high against the U.S. dollar this morning, supported by the delay and a temporary thaw in trade tensions. July 9 marks the end of the 90-day pause following Trump’s April 2 “Liberation Day” tariffs on the EU and other major trade partners.
The policy whiplash, combined with a sweeping fiscal bill that includes tax cuts and spending increases, resulted in the Pound Sterling’s rise to touch its highest level since February 2022. Gold prices slipped nearly 1% as the de-escalation in EU-U.S. trade tensions reduced demand for safe-haven assets.
USD/CAD is holding steady today after Friday’s sharp 0.90% drop to an eight-month low, last seen in early-October. The Canadian dollar remains firm despite recession concerns, as persistent inflation is keeping expectations alive that the Bank of Canada will hold rates steady at its June meeting. The Memorial Day holiday in the U.S. has kept trading volumes light and is muting price action.
Central bankers will gather tomorrow in Tokyo for the Bank of Japan’s annual policy symposium, and will focus on managing persistent inflation, slowing growth, volatile markets and geopolitical uncertainty. The meeting, often likened to the Jackson Hole symposium, underscores the global challenge of navigating this new monetary policy landscape.
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