Arabic version: اليورو يهبط إلى أدنى مستوى في 17 شهراً مقابل الدولار

According to Cnbc, the euro fell to its weakest level against the U.S. dollar in 17 months on Monday as concerns about Spain and France spread into wider markets. The currency was last down 0.6% against the greenback, reaching its lowest point since May 19, 2025, based on LSEG data.

The euro area is confronting higher inflation, interest rates and government borrowing costs. While the United States faces similar pressures, investors are focused on additional European vulnerabilities, including persistently weak growth, a fragmented bond market and political uncertainty in two of the euro zone’s biggest economies.

Spanish Prime Minister Pedro Sánchez was expected to call a snap election on Monday as protests over the country’s housing crisis intensified. In France, rising debt is becoming more expensive to service, while the government has presented a draft outline for a 2027 budget intended to reduce the public deficit from 5.4% of gross domestic product to 5% next year.

Barclays economists said France was unlikely to meet its fiscal targets even if the budget plan is adopted in the coming months. They said French fiscal and political developments were clouding the euro-area outlook, with weak fiscal fundamentals unlikely to reach an inflection point before next year’s presidential election.

ING strategists said that, even if passed in full, the French budget would not resolve the country’s structural fiscal problems. They said the deficit would remain too high to stabilise the debt ratio, while ageing-related spending and interest payments would continue to rise, leaving the next government to make further difficult choices.