The euro held steady at $1.154, hovering near its weakest level in more than two months, as tensions in the Middle East intensified following renewed exchanges of strikes between the US and Iran. President Donald Trump said Iran is taking "too long" to negotiate a peace deal and will now "pay the price," while Iranian Parliament Speaker Mohammad Bagher Ghalibaf asserted on Wednesday that Tehran would respond "decisively and without delay" to any act of aggression.
At the same time, investors are gearing up for the European Central Bank’s policy meeting on Thursday, where a widely expected 25-basis-point rate increase—its first move in a year—is seen as likely. The recent Israel–Iran conflict has triggered an energy shock and heightened inflationary pressures, reinforcing expectations of tighter monetary policy. Markets will focus closely on President Lagarde’s press conference for guidance on the ECB’s future policy path.
