News about euro

French government bonds and stocks sold off amid increasingly violent protests, adding pressure on the euro. The 10-year French yield rose as much as 8 basis points to 4.86%, while Germany's was flat at 3.41%, widening the spread to 145 basis points, its highest in two years. The CAC 40 fell nearly 1.3%, with Société Générale and BNP Paribas down 2.5% and 2.2%. Natixis CIB economists expect the French deficit to widen to 5.4% of GDP in 2026 and question the credibility of a €54bn savings plan for 2027, while Italy also saw cost-of-living protests, with clashes in Milan and lorry drivers blocking roads in the south.

The euro fell against most G10 currencies as the conflict in Ukraine escalated and protests spread across France, weakening confidence in the single currency. In early Asian trading, the euro dropped as much as 0.5% against the US dollar, touching 1.1183 USD/euro before trading around 1.1212 USD/euro at 7:02 a.m. Singapore time on October 19. Carol Kong, a strategist at Commonwealth Bank of Australia, said the euro could fall to support at 1.1130 USD/euro this week, especially if the dollar strengthens on geopolitical tensions. High energy costs threaten European economic growth and keep inflation risks elevated. The euro was the weakest G10 currency over the past month and last week fell to its lowest level since May 2025.