DAX rises as eurozone inflation cools

The DAX surged 1.7% on April 1, snapping a four-day losing streak, as Eurozone inflation cooled and business confidence improved, FXEmpire reports.

However, significant tariff risks persist. A potential 25% US levy on auto imports could stifle the DAX's momentum and severely impact German exporters, FXEmpire notes. The index's trajectory will largely depend on forthcoming tariff decisions.

At the start of the second quarter of 2025, market volatility remains elevated as investors braced for the US President's April 2 tariff announcement. However, a combination of softer-than-expected inflation data and improving risk appetite fueled a broad market rally on April 1. 

As FXEmpire reports, easing eurozone inflation bolstered expectations of further the European Central Bank's monetary policy easing. Lower borrowing costs could channel significant investment into European equities.