Dollar nears 18-month peak as euro slips on rising bond yields and French fiscal worries
The U.S. dollar edged toward its strongest level in 18 months while the euro fell to a 17-month low, pressured by higher oil prices and widening yield gaps in the eurozone.
Minutes from the Federal Reserve’s September meeting signaled that policymakers see inflation as the primary threat, reinforcing a stronger greenback that approached its highest level in a year and a half. Oil prices jumped, adding to a global bond sell-off that saw eurozone yields climb, especially French 10-year bonds, which widened the spread with German yields by five basis points. The euro slipped to $1.1174, its lowest since May 2025, as market participants cited both dollar strength and political uncertainty in France ahead of the 2027 presidential election.
The dollar index rose to 102.40, and market pricing shows an 80% chance the Fed will keep rates unchanged at its October meeting, with a December hike already priced in. Other currencies moved modestly: the yen rose to 158.27 per dollar, the Australian dollar fell to $0.6943, and the Chinese renminbi held at 6.7050 offshore.
Why it matters
Currency moves affect import prices, travel costs and global investment decisions for households and businesses.
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