FX.co ★ Euro Nears 17-Month Low on French Debt Concerns

The euro opened the week below $1.12, lingering near a 17‑month low, as investors weighed France’s record-high debt and political resistance to budget consolidation against the resilience of the US economy and the strength of the dollar. France’s 2027 budget plan targets a reduction of the fiscal deficit to 5% of GDP, but doubts are growing over the government’s ability to win parliamentary backing for sizeable spending cuts in a deeply fragmented legislature, especially with next year’s presidential election drawing closer. At the same time, Brent crude prices slipped as easing fears over supply disruptions led traders to scale back expectations of further interest rate hikes by major central banks. Market participants are now focused on Wednesday’s US CPI release for guidance on the Federal Reserve’s policy path, while eurozone central bankers are due to speak at the IMF–World Bank annual meetings in Bangkok later this week.