The euro is heading for a ninth straight day of gains versus the dollar, something it has only achieved three times since its inception in 1999. Another daily rise and we're in record territory.
In 2025's "everyone hates the dollar" trading environment, the euro, and European assets in general, have to be real magnets for investor cash.
The euro itself has gained nearly 14% against the dollar so far this year, while its performance against other currencies has been far less eye-popping. It has risen around 3.5% against both the pound and the Japanese yen and has barely broken even against the Swiss franc and Norwegian crown.
Confidence in the United States as an investment destination - not just in markets, but for businesses too - has not vanished, but has taken a serious knock from the erratic and unpredictable policies of the Trump administration.
This would not be obvious when looking through the lens of the stock market, given the S&P 500 is at record highs, in dollar terms at least. When priced in other currencies, it is a long way off.
Europe's STOXX 600 has risen 7% so far this year, compared with the S&P's 5% rise. On an equal-weighted basis, the divergence is even more marked. Wall Street's Magnificent 7 are back in vogue, but not quite riding to the rescue. The equal-weighted S&P is up 3.3% versus a near-10% gain in the STOXX equivalent.
That said, in spite of the chaos from Trump's on-again off-again tariffs, the heightened uncertainty stemming from the Middle East and the deficit-busting "One Big Beautiful Bill" that is up for debate in the Senate right now, investors aren't exactly ditching U.S. assets en masse.
"Anywhere But The USA" may sound catchy as an investment theme, but it has taken more than that to lure capital into Europe.
European governments, spearheaded by Germany, have pledged to unleash a one trillion euro ($1.17 trillion) spending bazooka, much of which will be concentrated on defence and infrastructure, as they attempt to address years of riding on the coattails of Washington for security, and of shortfalls in spending on basics at home.
The July 9 deadline for a trade deal is less than two weeks away - and with Trump saying he will impose 50% tariffs on all EU goods without a deal - investors are moving their money.
Data from LSEG's Lipper Funds show that more than $100 billion has flowed into European equity funds so far this year - up threefold from the same period last year - while outflows from the U.S. more than doubled to nearly $87 billion.
"All that is an indication that at least market forces, investors, those who move real money around, actually see value and have confidence in Europe," European Central Bank President Christine Lagarde said earlier this month.
She said now is the time for Europe to take its destiny into its own hands, and that this is the euro's "moment".
