Euro hits 17-month low as rates, inflation and political doubts weigh
The euro fell to its weakest level in 17 months, slipping below US$1.13 amid rising U.S. yields, higher oil prices and growing political uncertainty in Europe.
On Thursday the euro slid to a 17-month trough, trading under US$1.13 for the first time since May 2025, as investors reacted to higher U.S. Treasury yields and climbing oil prices. The currency also weakened against the yen and Swiss franc and barely stayed positive versus the pound. French sovereign yields jumped to their highest level in 14 years, while German benchmark bonds came under pressure, reflecting broader concerns about fiscal health in the eurozone.
Political uncertainty grew with a looming French election in 2027 and the rise of the far-right Alternative for Germany in regional polls, putting additional strain on the euro. European stock markets and bond prices fell, compounding the currency’s decline, while the U.S. dollar continued its multi-month rally against a basket of major currencies.
Why it matters
A weaker euro raises import costs and signals heightened economic and political risk across Europe.
In this story
