Vasilis Tsaprounis
Independent Analyst
The single European currency remains close to 1,0800 levels in the early hours of Tuesday with nothing new on the table, resulting in a narrow trading range.
Investors continue to closely monitor President Donald Trump, who remains highly unpredictable, and the '' dance '' he has set up around the issue of tariffs is sure to continue to attract interest and remain high on the agenda for some time.
How these policies will affect the level of inflation in the United States and the possibility of a recession is the subject of much analysis, but the conclusions are quite unclear.
At the moment there is some relatively intense confusion, the US currency could have appeared more favored by the latest pressure on international stock markets but this did not happen, which confirms that investors are avoiding taking big bets for the very near future.
The only asset that is clearly very favored by this situation is gold which has climbed to historical highs just below of 3150 $/oz following a stunning rally in the first quarter of 2025, but from now on I have significant doubts about its ability to maintain the same momentum.
The general market picture seems to remain stable, with the pattern of the previous days has a good chance of continuing as the pair remains heavy. Investors avoid taking big bets and it is possible that the exchange rate will have difficulty breaking some critical levels.
Apart from President Donald Trump '' tariffs dance'', interest still remains high in developments on the Ukrainian front and European politics, especially after the recent announcements of a gigantic increase in spending on infrastructure and defense.
The European economy continues to be a concern and it is not certain when the positive effects of the defense and infrastructure support packages from the eurozone states will be seen in the real economy.
Today's agenda is quite interesting, with consumer inflation index in Eurozone and the ISM Manufacturing Purchasing Managers Index (PMI) in US standing out.
No changes in my thoughts, i remain on hold and continue to have my doubts about how the European currency could re-fuel a strong bullish cycle.
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