European Union trade officials are increasingly accepting a 10% baseline on reciprocal tariffs as the new reality in negotiations with the United States. Multiple sources close to the matter confirm that U.S. negotiators, under the leadership of Commerce Secretary Howard Lutnick, have made it clear that any final deal must include a floor tariff of no less than 10% on EU goods entering the U.S. market.
Investor sentiment was rattled on Thursday as central banks in Norway and Switzerland made unanticipated policy moves, adding to the complexity of an already unpredictable global monetary landscape. In a surprising turn, Norges Bank cut its key policy rate, prompting a sharp slide in the Norwegian krone (NOK) against the U.S. dollar (USD) and the euro (EUR). On the same day, the Swiss National Bank (SNB) lowered borrowing costs to 0%, defying expectations of a return to negative interest rates.
Global stock markets retreated on Thursday as geopolitical tensions intensified in the Middle East. Reports of renewed Israeli-Iranian air strikes, combined with speculation about possible U.S. military involvement, prompted investors to move toward defensive assets. The U.S. dollar (USD) gained ground, while oil prices remained elevated. U.S. equity futures, including the S&P 500 Index $^SPX, slipped by 0.5%. Despite the selloff, most U.S. markets were closed due to a public holiday, limiting liquidity and amplifying volatility.
The People’s Bank of China (PBoC) has intensified its push to globalize the digital yuan (e-CNY), signaling broader ambitions to challenge the dominance of the U.S. dollar (USD) and promote a multipolar global currency system. At the Lujiazui Forum held in Shanghai, PBoC Governor Pan Gongsheng revealed plans to establish an international operations center for e-CNY in Shanghai, underscoring China's long-term strategy to reposition the yuan (CNY) on the international financial stage.
The Bank of Japan (BoJ) left markets parsing through nuanced messaging this week, as policymakers opted for a dovish stance on asset purchases while subtly acknowledging risks from rising inflationary pressures. The central bank's decision to slow the pace of bond purchase tapering caught attention for its short-term implications, but the broader signal was one of cautious optionality: a willingness to hike rates later in 2025 should inflation accelerate beyond tolerable limits.
The depreciation of the U.S. dollar (USD) has triggered a notable resurgence in a long-overlooked asset class: emerging market (EM) local currency debt. After more than a decade of subdued investor interest, funds flowing into EM local-currency bonds hit a record high, according to data from EPFR for the week ending Wednesday.
Poland has formally allocated more than 117 billion zlotys (PLN) — approximately $32 billion USD — in European Union Resilience and Recovery Funds, marking a pivotal phase in the disbursement of post-COVID stimulus capital. This figure represents 45% of Poland’s total EU allocation, underscoring the country’s accelerated efforts to leverage European funding for long-term economic revival.
The British pound (GBP) remained broadly stable against the U.S. dollar (USD) on Monday, reflecting heightened caution among investors ahead of the Bank of England’s (BoE) upcoming policy meeting. The market’s subdued tone comes against a backdrop of geopolitical instability, as tensions between Israel and Iran persist, prompting safe-haven flows into the greenback.
Metro Bank $MTRO.L, a UK-based retail and commercial lender, has reportedly been approached by private equity firm Pollen Street Capital regarding a potential takeover, according to Sky News. The interest marks a pivotal moment for one of Britain’s most scrutinized challenger banks, which has struggled with profitability, regulatory pressures, and investor confidence since its establishment in 2010.
Planned protests across major U.S. cities this Saturday, organized by the activist group "No Kings," are drawing heightened attention from investors and political analysts alike. The demonstrations are scheduled to coincide with a high-profile military parade in Washington, D.C., commemorating the 250th anniversary of the U.S. Army—and notably timed with former President Donald Trump's 79th birthday.
The British pound (GBP) rose modestly against the U.S. dollar (USD) on Thursday but weakened sharply versus the euro (EUR), reflecting a complex interplay of economic headwinds and geopolitical uncertainty. A simultaneous release of soft economic indicators from both the United Kingdom and the United States compounded investor caution, prompting a shift toward perceived safer assets, including the single currency.
The U.S. dollar (USD) has fallen to its weakest level in three years, driven by a confluence of shifting trade policy, heightened market uncertainty, and escalating expectations of Federal Reserve interest rate cuts. The U.S. Dollar Index (DXY) has dropped nearly 10% year-to-date, underscoring a broad retreat from the greenback amid weakening investor confidence in U.S. monetary and fiscal direction.
