Everyone wanted Europe on Wednesday, with Germany to relax its fiscal rules to unlock funds for increased military spending and to create an off-budget fund of 500 billion euros for infrastructure spending:

A note from MUFG sounds a note of caution:

  • Trump is sounding “very aggressive” on future tariff action on the EU
  • and thus, MUFG says they “are unconvinced that this move higher in the euro will extend much further”
eur german fiscal spending 06 March 2025 2

Is the shift in fundamentals enough for EUR/USD to break through that extended band of range trade just to the left?

Source: Forex Live