The euro strengthened to $1.144, rebounding from June’s one-year low, as expectations firmed for another European Central Bank interest rate hike in September. Markets are now pricing in more than 30 basis points of additional tightening by the end of the year.
US–Iran peace talks are set to continue despite recent hostilities that temporarily disrupted energy shipments through the Strait of Hormuz. Earlier in the week, Brent crude reached a two-week high, and US President Trump announced that the Iran ceasefire had ended, while emphasizing that Tehran still appears keen to reach an agreement.
In Europe, Germany’s cabinet approved a draft budget for 2027 that envisages €555.4 billion in spending and raises planned borrowing to €203.6 billion. In France, far-right leader Marine Le Pen confirmed she will run in the 2027 presidential election, with current polling favoring her National Rally party, even as uncertainty persists over who will succeed President Emmanuel Macron.
