The euro stabilized around the $1.08 level as investors assessed key inflation data while bracing for reciprocal U.S. tariffs set to take effect on April 2.
Regional German CPI data presented a mixed picture, indicating that inflation in Europe’s largest economy remained largely unchanged in March.
Meanwhile, other flash CPI reports showed that France’s inflation rate held steady at a four-year low of 0.8%, Spain’s inflation unexpectedly fell to a five-month low of 2.3%, and Italy’s inflation climbed to a 1.5-year high of 2.0%.
Slowing inflationary pressures across the eurozone, coupled with global trade war concerns, fueled expectations that the European Central Bank will cut interest rates by 65 basis points this year.
Meanwhile, the euro is on track for a 3.1% monthly gain, supported by broad dollar weakness amid shifting U.S. tariff policies under Trump and Germany’s approval of a major fiscal package.
