TOKYO — The euro gained on Monday following the announcement of a framework trade agreement between the United States and the European Union, the latest in a flurry of deals to avert a global trade war.
Meeting in Scotland on Sunday, US President Donald Trump and European Commission President Ursula von der Leyen announced the deal, which will result in a 15 percent tariff on EU goods, half what Trump had threatened to impose from August 1.
Senior US and Chinese negotiators are due to meet in Stockholm on Monday with an aim to extend a trade truce and prevent steep tariff hikes. Meanwhile, investor attention is shifting towards corporate earnings and central bank meetings in the US and Japan.
“It could be a positive week, just purely from the fact that now we know the rules of the game, if you like,” said Rodrigo Catril, senior currency strategist at National Australia Bank.
“Now that there is more clarity, you would think that not only in the US, but around the globe, there will be a little bit more willingness to look at investment, to look at expansions, and to look at where the opportunities are,” he said on a NAB podcast.
The euro stood at $1.1763, up 0.2 percent so far in Asia. The common currency rose 0.2 percent to 173.78 yen.
Trump said the EU plans to invest some $600 billion in the US and dramatically increase its purchases of American energy and military equipment. The pact is similar to one forged with Tokyo negotiators last week that will see Japan investing some $550 billion in the US and a 15 percent tariff imposed on its cars and other imports.
