The Latest Breaking News from eurozone

June S&P 500 E-Mini futures (ESM25) are up +0.12%, and June Nasdaq 100 E-Mini futures (NQM25) are up +0.24% this morning as investors await the latest reading on U.S. job openings and manufacturing sector surveys.

Germany’s inflation eased to a four-month low in March, while Italy’s rose to its highest in over a year, highlighting diverging trends. The mixed data suggest uneven disinflation across the eurozone ahead of the bloc’s inflation release.

This week, Trump’s auto and reciprocal tariffs are set to rattle the global markets as sentiment soured amid recession fears. Key economic data, including inflation readings from the eurozone, employment change from the US, and Reserve Bank of Australia’s interest rate decisions, will be in focus.

Uncertainty around US trade tariffs is costing the eurozone and the UK economy billions this year and the next, which cannot be entirely offset by increased defence spending in 2025.

Eurozone business activity expanded for a third straight month in March, driven by a rebound in German manufacturing and easing inflation pressures, offering early signs of a more sustained recovery.

Eurozone consumer confidence weakened as looming trade tariffs raised concerns over growth and inflation. Meanwhile, Germany approved a massive fiscal package, but economists urged caution over immediate excitement.

A trade war could push up eurozone inflation by half a percentage point alone with detrimental effects on growth, ECB’s Lagarde warns. The ECB president said rising trade tensions and a weaker euro could complicate monetary policy.

Germany’s economic sentiment hit a 2-year high, but the eurozone’s trade surplus fell sharply. EU exports to the US surged as firms frontloaded shipments ahead of potential Trump tariffs, while the trade deficit with China widened sharply.

The OECD has lowered its eurozone GDP growth forecast to 1.0% for 2025, down from 1.3% in December, citing weak investment and rising geopolitical risks. Global growth is also revised down to 3.1% as trade disruptions weigh on sentiment.

Massive German spending pledges and uncertainty caused by US trade policy are fuelling expectations the European Central Bank could on Thursday signal that a pause in interest rate cuts is in sight, analysts said.

The dollar index (DXY00 ) on Monday fell by -0.87%. Monday’s strength in EUR/USD undercut the dollar as stronger-than-expected Eurozone economic news boosted European government bond yields. The dollar extended its losses on weaker-than-expected US ISM and construction spending reports. The dollar recovered from its worst levels after a slide...