The Euro as an alternative to the dollar

After U.S. President Donald Trump imposed tariffs, global markets suffered a sharp jolt, leading investors to rethink the dollar's role as a safe haven and reconsider the euro's position in the international financial system, according to Bloomberg.

The report highlights that Trump's tariff policy generated great economic uncertainty, which allowed the euro to reach its highest level in three years, with a rise of close to 4% in just two days, rising from $1.10 to almost $1.15. At 12:31 (GMT) on Monday, the euro was trading at $1.14.

This is the euro's biggest rise in 15 years and, according to Bloomberg, the trend continues to rise, with hedge funds predicting it could reach $1.20 in the next three to six months.

Jordan Rochester, chief strategy officer at Mizuho International plc, noted that his expectation of a euro between $1.15 and $1.20 is becoming a real possibility.

The agency notes that the euro has begun to take over some of the dollar's traditional role as a safe haven as doubts about the U.S. economy grow. Thus, the European currency, once considered a risk asset, is now emerging as a key alternative safe haven in the face of dollar weakness.