The impact of Trump’s Tariffs on the exchange rates

The recent announcement of new tariffs by President Donald Trump has sent ripples through the global financial markets. The tariffs, which target a wide range of imported goods, have led to significant volatility in the FX markets. 

These Tariffs lead to several economic implications which will directly affect the FX markets. Not only will higher tariffs likely lead to increased costs for imported goods, contributing to inflationary pressures, which will prompt central banks to adjust their monetary policies, impacting currency values. But countries which are heavily reliant on exports to the US may see their trade balances affected, leading to adjustments in their currency values.  

You may be concerned about how this volatility could be affecting your property purchase in France. Or how you could take advantage of the volatility? Following an action-packed week, FX markets are changing rapidly, and it seems the euro has benefitted in the short term. 

Essentially, right now is a great time for France property sellers. 

Sterling Euro buyers – GBP/EUR 

In the space of 5 days, the GBP/EUR exchange rate fell by over 3% from 1.20 down to a fresh 8 month low of 1.1630.  

What does this mean for those looking to buy euros?  

To put this into perspective, a property worth €500,000 today (8^th April 2025) would cost you roughly £13,000 more than it did 5 days ago (2^nd April 2025). 

US Dollar buyers – USD/EUR  

The USD/EUR exchange rate saw a similar 3% movement but just over the course of a day. This would have equated to a difference of around $17,000 more expensive.  

Both amounts are substantial and could very well be the difference between afforbalility for those expecting to complete over the past couple of weeks. 

Movements such as these, can occur sporadically within uncertain markets. Below we discuss the tools available when using a currency specialist to protect you from negative market movements or make the most of movements in your favour.  

How can you make use of these market movement? 

Using a currency specialist opens the door to many options. It gives you access to competitive exchange rates and the expertise of experienced foreign exchange professionals who can help you plan your transfer to make the most of your money. They understand your situation and support you by tracking the rate and guiding you on the best time to trade, helping to make your money go further. 

Here are a few tools available to you and how they can benefit your currency exchange: 

• Spot contract: An agreement between you and your FX provider to exchange money and buy foreign currency at the current exchange rate. This is the most common and traditional form of currency exchange, suited to addressing any imminent currency transfer needs you might have. 

• Market order: Using a market order, you can target a rate of exchange, and if that rate is hit, the funds can be bought automatically or with your permission. Similarly, a limit order can protect your transaction if the rate falls below a certain level. This suits those with flexible timing who are optimistic that the rate might improve within their timeframe. 

• Forward contract: This allows you to fix a rate of exchange up to two years in advance of payment. This tool is popular among property buyers as it allows them to fix the full price of the property ahead of completion, giving them peace of mind and certainty about how much they will pay. It is also a great way to take advantage of a positive rate movement (note that forward contracts may require a deposit), or, in this case remove any risk of the market moving out of your favour. 

To take advantage of the exchange rates, it is key to plan in advance and get in touch with a currency specialist early in the process. 

At Moneycorp, you will get assistance throughout your journey, from the moment you start looking for a property and planning your viewing trips to when you secure a property and have to pay the deposit and plan for completion. 

Getting familiar with the exchange rates will help you set up your budget prior to putting in an offer. Contacting a foreign exchange specialist will help you understand your options and protect your budget from negative fluctuations – at no cost to you.

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