In early morning trading, the euro fell to $1.12. To find a weaker exchange rate for the euro, you have to go back to May 2025.
In addition to France’s large budget deficit, national debt and political instability ahead of next year’s presidential election, market concerns about debt-laden Spain, which looks set to head for a snap election, are also contributing. The political instability in France has pushed the risk premium on French government bonds to its highest level since the euro crisis in 2011.
At the same time, the dollar is gaining strength amid expectations of interest rate hikes by the US Federal Reserve (Fed).
