FX.co ★ Euro Weakens to 2-1/2-Month Low Amid French Budget Concerns

The euro weakened, nearing the $1.15 mark, its lowest point since July 31, as investors paid close attention to political developments unfolding in France. The reappointed Prime Minister, Sébastien Lecornu, is under pressure to submit the 2026 budget bill to parliament before constitutional deadlines for legislative review expire. The proposed budget, as evaluated by the Haut Conseil des Finances Publiques, is designed to reduce the Eurozone's largest deficit to a range of 4.7% to 5% of GDP—an improvement from the current year's 5.4%. In parallel, apprehensions about a potential trade war between the United States and China were reignited after both nations announced new port fees on ocean shipping companies. This move comes on the heels of President Trump's threat to impose 100% tariffs on Chinese imports and China's decision to impose stricter controls on rare earth exports. On the economic data front, while German investor sentiment saw some improvement in October, it fell short of expectations, contributing to a cautious market outlook.