The euro remained near the 17-month low reached yesterday amid political uncertainty and fiscal concerns in the eurozone. At the same time, the U.S. dollar continued its rapid recovery, supported by higher U.S. Treasury yields, Reuters reported, quoted by BTA.
In morning interbank trade in Frankfurt, the euro was quoted at $1.1211, down 0.1 percent from its level last night. Yesterday, the single European currency reached its lowest value against the dollar since May 2025, continuing its decline of more than 1 percent last week.
According to analysts, the euro remains under pressure due to concerns about high debt levels and political deadlock in France. An additional factor is the upcoming early elections in Spain.
The weakening of the euro is another worrying signal for politicians, as the increase in French debt costs is affecting the economy of the entire euro zone, Reuters points out.
“We are quite pessimistic about the euro. We think it will fall below $1.10“, said Joseph Capurso, strategist at “Commonwealth Bank of Australia“ (Commonwealth Bank of Australia).
According to Capurso, in order for the euro to appreciate, a significant drop in oil prices would be necessary, as well as a significant increase in expectations for tightening European monetary policy. As a possible factor for strengthening the single currency, he also pointed to the control of budget deficits in Europe, “although there is no chance of this happening in the near future“.
Meanwhile, the US dollar continued to appreciate, supported by the still high yield of US government bonds. Their yield reached its highest levels in decades tonight.
The British pound also fell against the dollar - by 0.06 percent to $1.3216. The Japanese yen, however, rose 0.18 percent to 158.16 yen per dollar.
The U.S. dollar index, which tracks the U.S. currency against a basket of major foreign currencies, was unchanged at 102.17. It had hit an 18-month high in the previous trading session.