Trump's Charm Offense In Europe Unleashes Dollar Thunder

The U.S. dollar surged Monday after Trump and European Commission President Ursula von der Leyen struck a trade deal that capped tariffs on EU goods at 15%, according to Benzinga. The agreement also included $750 billion in U.S. energy purchases, $600 billion in EU investment, and major deals in AI chips and military equipment. The dollar index jumped 1%, its best day in over two months, while the euro saw its second-worst performance of 2025. Analysts said the rally was driven both by favorable terms and short covering, as traders had been heavily short on the dollar. ING pointed to this week’s economic data as likely to support the Fed’s patient rate stance. Goldman Sachs warned that the long-term tariff structure could ultimately weaken U.S. trade dynamics and the dollar.