Tariffs move currency markets

The German economic stimulus package and rising defence spending in the eurozone recently caused the euro to strengthen against the US dollar. EURUSD is likely to remain volatile but consolidate at a significantly higher level. The yen also appreciated strongly against the dollar. However, the yen weakened slightly against the euro. The Swiss franc appreciated significantly against many currencies following the tariff announcements. The SNB is likely to cut its key interest rate to 0% at its next meeting, which should not support the CHF and allow the euro to recover.