The euro fell to its lowest level against the US dollar since March 2025 on Monday as concerns over European public finances and political uncertainty weighed on investor sentiment.
The single currency traded 0.6% lower at $1.1164 as of 0700GMT.
Pressure on the euro followed sharp swings in French government bonds on Friday. The gap between French and German 10-year borrowing costs widened to as much as 159 basis points before narrowing to around 141 basis points by the close.
France’s 10-year bond yield briefly approached 5%, reflecting increased investor demand for compensation to hold French debt.
Concerns over France’s fiscal outlook and political uncertainty ahead of the 2027 presidential election have raised fears that strains could spread to other heavily indebted eurozone economies.
A firmer dollar added to the pressure. The US currency strengthened despite softer-than-expected US employment data and reduced expectations of a Federal Reserve interest-rate hike this month.