EUR/USD (Euro –US Dollar)

The European Union may delay its retaliatory tariffs against the U.S. until mid-April to allow more time for negotiations with the Trump administration, a senior official said Thursday. The bloc last week said it plans tariffs of up to 50% on a range of U.S. products in response to U.S. levies on global steel and aluminum imports. The EU tariffs were initially planned to take effect in two phases.

European stocks fell and the euro weakened, after European Central Bank President Christine Lagarde said tit-for-tat tariffs with the U.S. would weaken regional growth and kindle inflation. Lagarde said an increase in U.S. tariffs of 25 percentage points would lower the eurozone’s economic growth rate by 0.3 percentage point in the first year. Should the European Union retaliate by hiking U.S. tariffs, growth would be slow by half a percentage point, and eurozone inflation would rise by the same magnitude.

The US dollar is down in most of its pairs and gold up in the immediate aftermath of lower than expected American inflation.

The European Union announced retaliatory tariffs against the U.S. early Wednesday. Its levies will take effect at the start of next month and target a range of products including bourbon whiskey, boats and motorcycles.

President Trump's tariffs could dent U.S. growth and confidence, according to economists. Meanwhile, the withdrawal of U.S. support for Ukraine, and broader concerns that U.S. can no longer be counted on for protection, have lit a fire under European governments.

The data will be welcomed by the European Central Bank (ECB), which opted to cut its key interest rate by 25 basis points on Thursday to 2.5%.

The euro edged higher after the European Central Bank cut interest rates but signaled it could move cautiously with further easing. It raised its 2025 inflation forecast, cut its annual eurozone growth forecasts through next year, and warned about the risk of trade tensions. One major caveat: Its forecasts were made before Germany and the European Commission announced plans to aggressively increase defense expenditure.

The European Central Bank cut interest rates to boost growth, with the euro zone's stalled economy facing twin shocks from President Trump's tariff threats and a sudden need to radically increase military spending.

In the latest Trader Talk episode, where host Kenny Polcari and Dr. Scholl Foundation President and CEO Dan Mahaffee explore the geopolitical myths and realities shaping today’s markets. Broadcasting from the New York Stock Exchange, Polcari leverages decades of institutional experience to cut through the noise and help investors focus on what truly matters. Polcari opens by debunking the popular belief in imminent rate cuts—a comforting bedtime story for many investors. He points out that the economy isn’t collapsing: the labor market remains robust, wages are strong, and corporate earnings are mostly solid. Rate cuts, he explains, are not a gift but a tool for deep economic distress. Instead of banking on a Fed pivot, investors should base decisions on the actual data. Mahaffee brings a global perspective, delving into how geopolitical tensions—such as the European challenges and the ongoing conflict in Ukraine—intertwine with trade negotiations. He discusses critical mineral deals necessary for modern industries like semiconductors and drones, highlighting the delicate balance between national security and economic interests. Mahaffee also warns against relying on quick fixes, emphasizing that tariffs and reciprocal measures are tools for negotiation, not guaranteed solutions. Rounding out the episode, Polcari shares three essential market tips: tune into central bank briefings, analyze earnings beyond headline figures, and stay alert to geopolitical developments. And, as always, the show concludes with a nod to tradition—the Luncheon Club Lobster Roll, a market recipe steeped in NYSE history. Luncheon Club Lobster Roll Recipe Ingredients 1 lb. fresh lobster meat, steamed (Ask the grocery seafood counter to steam it if you like) Brioche roll, toasted and buttered Fresh lemon wedges ⅓ cup premium mayonnaise 2 tablespoons fresh lemon juice 2 tablespoons finely diced celery 1 tablespoon fresh chives, minced 1 teaspoon Dijon mustard Sea salt and white pepper (to taste) Fresh dill sprigs Butter lettuce leaves Potato chips (Cape Cod chips recommended) Steps Prepare the Sauce: In a small bowl, whisk together the mayonnaise, lemon juice, celery, chives, Dijon mustard, salt, and white pepper. Mix with Lobster: Gently combine the steamed lobster meat with the prepared sauce. Toast & Butter Rolls: Butter the brioche roll(s), then toast or griddle until golden. Assemble: Line the toasted roll with butter lettuce leaves.Spoon the dressed lobster onto the roll. Finish & Serve: Top with fresh dill. Add lemon wedges on the side. Serve with Cape Cod-style potato chips for extra crunch. Watch more episodes of Trader Talk here. Trader Talk with Kenny Polcari on Yahoo Finance delivers expert analysis and actionable insights, empowering you to navigate market volatility and secure your financial future. You can catch every episode on Apple Podcasts, Spotify, Amazon Music, or wherever you get your podcasts This post was written by Langston Sessoms.

France is heading towards difficult budgetary trade-offs to reconcile its commitment to lower budget deficits while increasing defence spending given France’s role in strengthening Europe’s security architecture.

The headline number will be an important factor at the European Central Bank's rate-setting meeting later this week.

In the wake of the recent elections in Germany, European markets are reflecting uncertainty as investors weigh potential impacts. While the euro (EURUSD=X) briefly surged due to conservative victories, market reactions have been mixed as traders continue to eye global opportunities. In the US there is a wait-and-see approach regarding tariffs, with expectations that the situation will ultimately be resolved, similar to President Trump's negotiation style. FedWatch Advisors founder and CIO Ben Emons joins Market Domination Overtime hosts Julie Hyman and Josh Lipton to share his insights on the market environment (^GSPC, ^IXIC, ^DJI), stating that markets are still "banking" on Trump's tariffs to go into effect early March. "It will ultimately all come together because this is the way President Trump sort of manages this process, right? A lot of threats," Emons says. "But then it gets the parties at the table and there's a conclusion" Regarding the German elections, Emons highlights the significant shift that could come by saying "it's a big swing to the right again in Germany, which is happening across the Eurozone over the last several years." "I think it's really a reflection of voters just being really uneasy with everything that was done during the pandemic, in the aftermath," he adds. To watch more expert insights and analysis on the latest market action, check out more Market Domination Overtime here. This post was written by Josh Lynch

The US dollar index (DX-Y.NYB) faces downward pressure as investors struggle to interpret the Trump administration's trade policies. A new concept dubbed the "Mar-a-Lago accord" has emerged on Wall Street, a proposal by President Trump to reform global trading, address economic imbalances, and "prevent the overvaluation of the dollar." DZ Bank Head of Monetary Policy and FX Research Sonja Marten joins Morning Brief anchors Seana Smith and Brad Smith to analyze these developments. "It's really difficult to look through the very confused messaging we've been getting here," Marten says about the White House, describing Trump's first month as "difficult." "I think when you look at the market reaction (^DJI, ^IXIC, ^GSPC) ... there's been some movement, but I think investors are really really struggling to see clear headway," she explains, noting that markets are attempting to balance potential economic impacts against determining which White House statements should be taken seriously. Regarding specific tariff policies, Marten emphasizes that today's environment differs significantly from 2016. The current tariffs were implemented immediately upon Trump taking office, and the "level" of tariffs is considerably more severe than during his first presidency. She adds, "I think we have a much more determined Trump to deal with." "A lot of people presume that Trump barks, but he won't bite," Marten states, warning, "I think the market is underestimating and underpricing this risk." To watch more expert insights and analysis on the latest market action, check out more Morning Brief here. This post was written by Angel Smith

Rising tariffs, lower growth, higher defence spending, deeper political fragmentation and rising dollar-denominated borrowing costs are set to weaken the European credit outlook unless Europe unites and makes bold reforms.

The new government coalition provides an opportunity to address Belgium’s fiscal challenges, although the trade-offs between budgetary consolidation and the administration’s social and economic agendas could slow reform.

Expectations for the Fed’s next cut shift back to July.

Tariffs and politics remain in focus.

The data poses an interesting question for the the European Central Bank, which is expected to implement back-to-back interest rate cuts until July.

The Fed’s lower dovishness seems to be priced in while other major central banks mostly loosen policy.

Despite a generally strong job report, the pound has held close to recent lows.