Investing.com — has begun to act as a safe-haven currency during several market stress events in 2025 and early 2026, according to a European Central Bank report published Tuesday.
The currency appreciated alongside traditional safe havens like the and during risk-off episodes, marking a departure from historical patterns.
Between January 2006 and April 2026, the euro effective exchange rate typically experienced modest appreciations of about 0.1% during risk-off events, compared with nearly 0.7% for the Swiss franc.
The euro’s safe-haven behavior emerged notably after the U.S. administration introduced tariffs on April 2, 2025, which triggered high volatility in global financial markets. During this period, the euro appreciated while the U.S. dollar depreciated and rose.
Similar patterns occurred during other risk-off events originating from the United States throughout 2025 and early 2026.
The euro appreciated when the U.S. Department of Justice issued subpoenas to the Federal Reserve and when the U.S. administration threatened to increase tariffs on European imports.
Following the outbreak of war in the Middle East, the euro initially depreciated before reversing some losses as geopolitical tensions eased. The U.S. dollar’s strength during this period was partly explained by global risk factors, while diverging economic outlooks between the U.S. and euro area also influenced exchange rates.
Data showed that the value of U.S. Treasuries held in custody at the New York Federal Reserve by official institutions dropped by $82 billion to $2.7 trillion in March 2026, the lowest level since 2012.
increased in 2025, while purchases of euro area debt and equities by foreign investors reached multi-year highs by the end of 2025.
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