Euro Recovers Above $1.12, but Weekly Losses Persist
The euro rebounded above $1.12 after hitting a 17-month low of $1.1161 earlier this week, supported by stabilizing French bond markets and easing energy prices and US Treasury yields, which weakened the dollar’s rally. However, the common currency remained on track for a fifth consecutive weekly decline, with cumulative losses of around 3% against the dollar, as investors weighed France’s record-high debt and the political challenges of implementing budget cuts against a resilient US economy and stronger dollar. Meanwhile, Brent crude retreated from its recent rally after US President Donald Trump said Washington would not launch an attack on Iran before the November midterm congressional elections, citing productive talks aimed at ending the conflict. The easing in oil prices prompted traders to scale back expectations for central bank rate hikes, with the ECB deposit rate now priced to rise from 2.50% currently to 2.72% by December and 3.20% by late 2027.
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1161 earlier this week, supported by stabilizing French bond markets and easing energy prices and US Treasury yields, which weakened the dollar’s rally. However, the common currency remained on track for a fifth consecutive weekly decline, with cumulative losses of around 3% against the dollar, as investors weighed France’s record-high debt and the political challenges of implementing budget cuts against a resilient US economy and stronger dollar.
Meanwhile, Brent crude retreated from its recent rally after US President Donald Trump said Washington would not launch an attack on Iran before the November midterm congressional elections, citing productive talks aimed at ending the conflict. 20% by late 2027.