2025.09.0107:25:29UTC+00Euro Strengthens as Dollar Pressured by Fed, Trade Uncertainty

At the beginning of September, the euro surged past $1.17, maintaining August's 0.8% increase and approaching its highest mark since late July, predominantly due to a weakening dollar. Market participants are closely monitoring the US labor market data scheduled for release this week, which could provide insights into the magnitude of a potential Federal Reserve rate cut later this month. Concerns about the independence of the Fed are also impacting the dollar's value. This was highlighted by the inconclusive outcome of a court hearing regarding President Trump's attempt to remove Fed Governor Cook, leaving her in her position for the time being. Additionally, trade uncertainties continue to exert pressure. Despite a federal appeals court's ruling that deemed most of Trump's tariffs illegal, US Trade Representative Jamieson Greer has confirmed that discussions with trade partners are proceeding. In a related move, the European Commission recently suggested eliminating tariffs on US industrial goods, a proposal that might provoke a retroactive reduction of US tariffs on European automobiles.