Trade Tensions and Currency Fluctuations Stir Global Markets

The U.S. dollar strengthened amid global trade tensions, with the euro weakening due to EU-U.S. tariffs and economic uncertainty. Market volatility was fueled by tariffs threats from President Trump, euro-dollar shifts, and potential U.S. government shutdown risks. The Japanese yen and global currencies showed mixed movement.

The U.S. dollar strengthened broadly on Friday as the euro distanced itself from its recent high amid escalating global trade tensions and fears of an economic downturn. The yen also lost ground, with little expectation of a Bank of Japan interest rate hike in May.

In another move that rattled markets, President Donald Trump threatened 200% tariffs on European alcohol imports. This came in response to impending EU tariffs on American products, a countermeasure to U.S. tariffs on steel and aluminium.

The uncertainty over a U.S. government shutdown added to market jitters, even as Senate Democrat Chuck Schumer signaled his party's support to keep the government running. Meanwhile, Japan's yen showed mixed movement, coupled with market anticipation of wage negotiation results.

(With inputs from agencies.)