French bond contagion fears push euro to 17-month lows
Surging French borrowing costs and rising political uncertainty have sparked fears of regional contagion, pushing the euro to seventeen-month lows against the dollar. Investors are dumping French debt while shifting to safe German bonds, complicating the European Central Bank policy outlook.
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The EUR/USD fell below $1.12 during Monday's late evening session, hitting 17-month lows as rising borrowing costs in France triggered contagion fears across the euro area. The single currency also tumbled against sterling, the Swiss franc, and the Japanese yen. This broad sell-off tests the European Central Bank's ability to balance soaring inflation against mounting debt pressures in the bloc.
