Euro at Risk of Further Losses on French Debt Concerns

Dow Jones
2 hours ago

0743 GMT - The euro is likely to face further weakness in the near term due to concerns about France's fiscal position, Commerzbank's Thu Lan Nguyen says in a note. Ambitious plans to rein in public spending by far-right presidential candidate Marine Le Pen provided only temporary relief, she says. "One reason may be that she simultaneously called on the European Central Bank to intervene in order to give euro-area governments greater fiscal room for manoeuvre." Meanwhile, France's central bank chief Emmanuel Moulin said he doesn't think the ECB needs to intervene at this point. Against this backdrop, continued market nervousness appears justified, Nguyen says. The euro trades flat at $1.1190 after reaching a 16-month low of $1.1160 Monday, LSEG data show.(renae.dyer@wsj.com)

Dollar Stays Elevated as Treasury Yields, Oil Prices Rise

0638 GMT - The dollar remains firm as Treasury yields and oil prices rise amid continued tensions in the Middle East while the Federal Reserve's latest meting minutes pointed to further rate increases. The minutes of the Fed's September meeting showed most policymakers expected another rate increase this year. Policymakers continued to see inflationary risks stemming from AI investments, improving pricing power, higher inflation expectations and demand for skilled labor, Danske Bank analyst Jens Peter Sorensen says in a note. "We agree on all points but also think that the post-meeting tightening in financial conditions will delay the next hike until December." The DXY dollar index rises 0.1% to 102.293, close to the near 18-month high of 102.535 reached Monday. (renae.dyer@wsj.com)

Bitcoin Falls Along With U.S. Stocks as Treasury Yields, Oil Prices Rise

0653 GMT - Bitcoin falls to a two-and-a-half-week low following declines in U.S. stocks overnight as Treasury yields rise and oil prices rally amid ongoing conflict in the Middle East. Bitcoin's correlation to U.S. equities is rising while the surge in yields along with the dollar creates a difficult environment for speculative assets that depend heavily on liquidity and lower real yields adjusted for inflation, Zaye Capital Markets analyst Naeem Aslam says in a note. "The immediate direction depends less on crypto-specific headlines and more on whether Treasury yields, the dollar and inflation expectations begin to ease." Bitcoin falls 0.9% to $82,683, having earlier reached as low as $82,265, LSEG data show.

 

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