Euro Drops As Trump Threatens 50% Tariff On EU

The euro fell on Friday, reversing earlier gains after U.S. President Donald Trump said he would recommend imposing a 50% tariff on the European Union starting June 1, reigniting investor fears over the impact of such duties on global trade and the world economy, Amanda Cooper reported for Reuters.

At one point, the euro rose by nearly 0.8% following Trump's separate warning of a 25% tariff on Apple for iPhones not made in the United States.

In a Truth Social post, Trump stated: “The EU was very difficult to deal with, and our negotiations with them are going nowhere... Therefore, I am recommending a straight 50% Tariff on the EU, starting on June 1, 2025. There is no Tariff if the product is built or manufactured in the U.S.”

Earlier in the day, the euro had risen by nearly 0.8% following Trump's separate warning of a 25% tariff on Apple for iPhones not made in the United States. It was last up 0.45% at $1.1336.

The dollar pared some losses against the Japanese yen and the British pound after Trump’s post, but it remained on track for its first weekly decline against a basket of currencies in five weeks.

Investor focus has sharpened on the U.S. debt situation after Moody’s downgraded the country's credit rating last week. Market watchers are also closely following Trump’s tax bill, which could significantly expand the already massive $36 trillion U.S. federal debt.