The euro has reached a four-month high against the US dollar, trading at $1.0798, driven by expectations of increased European defense spending. This development comes as the European Union considers a substantial boost to its defense budget, with proposals including an €800 billion fund to support military and infrastructure investments. Germany has also announced a €500 billion plan for infrastructure and defense spending. Meanwhile, the US dollar index (DXY) has fallen to a near four-month low, dropping 3% over the past three days, impacted by concerns over US economic growth and the negative effects of newly imposed tariffs on Canada, Mexico, and China. The tariffs, alongside reciprocal measures from affected countries, have heightened fears of a trade war and potential recession in the US. Bund yields have risen to 2.48% amid these developments. In Turkey, the euro has hit an all-time high, exceeding 39 Turkish lira, while the dollar remains stable at around 36.43 lira. The euro's strength reflects broader global trends, including its gains against other major currencies such as the British pound, which has risen to $1.2906, its highest level since November 2024.