Global Trade Tensions Stir Currency Markets, U.S. Dollar Strengthens

The U.S. dollar strengthened as global trade tensions escalated, affecting the euro, which moved away from a five-month peak. U.S. tariffs threatened European imports, causing market volatility. Investors turned to safe havens amidst fears of economic slowdown. Other currencies and sectors also displayed marked fluctuations.

The U.S. dollar gained strength on Friday amid escalating global trade tensions, notably with the euro decreasing from a five-month high. The markets reacted as U.S. President Donald Trump threatened to impose a 200% tariff on European alcohol imports, following EU plans to tax American whiskey.

This trade skirmish between the U.S. and EU has heightened fears of economic slowdown, driving investors to seek safe haven assets. The S&P 500 recently dipped into correction territory, impacted by these tensions and uncertainties surrounding the U.S. economy.

The euro's value fell to $1.0847 as the trade dispute unsettled markets. Additionally, concerns over a potential U.S. government shutdown, and evolving circumstances in currency markets, further contributed to economic uncertainties.

(With inputs from agencies.)