European stock markets are seeing a significant uptick following the announcement of a German debt brake deal, with the DAX gaining 2.2%. Conversely, the US dollar has decreased substantially after President Trump's announcement of new tariffs on key trade partners Canada, Mexico, and China. Trump's aggressive trade stance has raised concerns about a potential economic downturn, dubbed 'Trumpcession'. The Atlanta Federal Reserve now predicts a 2.8% contraction in US GDP, and Deutsche Bank analysts warn of the diminishing safe-haven status of the dollar amid these economic anxieties.
The dollar has fallen further, hitting the lowest level since November, after Donald Trump said his new tariffs will cause a little disturbance in a combative speech to Congress.
Trump's trade policies have sparked 'Trumpcession' fears, concerns that they could push the American economy into a contraction or even recession.
A closely watched gauge of the US economy weakened a couple of days ago, with the Atlanta Federal Reserve's GDPNow model estimating US GDP will shrink at an annualized rate of 2.8%.
Analysts at Deutsche Bank expressed concerns about the potential loss of the dollar's safe-haven status, depending on the evolving US policy path.
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