Europe's Central Bankers Fear Turbulence as US Relations Sour

Central bankers from Europe are expressing concern over the US administration's actions, fearing potential turmoil in their already strained relationship. The concerns stem from recent US Treasury interventions, including a surprise sale of euros to prop up the Japanese yen and plans to increase buybacks of longer-dated bonds. These moves have raised eyebrows among European officials, who feel they were not given proper notice or explanation.

The US Treasury Secretary, Scott Bessent, has confirmed that the euro sales were part of a reallocation of resources from the Exchange Stabilization Fund. However, European officials are still upset about being caught off guard by the move, with one describing it as 'infuriating' and saying 'you always pick up the phone and give heads-up.'

Another concern is that these actions may be a sign of more unusual measures to come from the administration. The sources point out that President Donald Trump has shown a willingness to push boundaries in pursuit of his policies, which could have far-reaching consequences for global financial markets.