The euro fell amid protests in France and geopolitical tensions

The euro fell against most G10 currencies amid escalating tensions over Ukraine and mass protests in France, which heightened concerns about the country’s fiscal situation, according to Bloomberg. During morning trading in Asia on October 19, the euro fell 0.5% against the dollar, dropping to $1.1183, before partially recovering and settling around $1.123.

Over the past month, the euro has underperformed among G10 currencies, and last week it fell to its lowest level since May 2025. According to data from the Commodity Futures Trading Commission (CFTC) for the week ending October 13, hedge funds are more bearish on the euro than they have been since July.

The euro came under pressure after U.S. support for Moscow prompted Ukraine to step up attacks on Russian energy infrastructure, a move that is likely to heighten concerns about rising oil prices, noted Rodrigo Catril, a strategist at National Australia Bank.

Tensions between Ukraine and the U.S. escalated after Donald Trump reached an agreement with Vladimir Putin that Washington would refrain from further tightening sanctions against Russia in exchange for Moscow supplying diesel fuel to the global market to curb rising prices. Any escalation of geopolitical risks in Europe could boost demand for safe-haven assets and put additional pressure on the euro, Bloomberg reports.

In addition, protests against the rising cost of living in several French cities, including Paris, escalated over the weekend into one of the most serious outbreaks of street violence the country has seen in years. According to Katril, the protests will make it difficult for the authorities to implement austerity measures, and the combination of these factors could push the euro below $1.11.

“France’s budget problems are serious enough on their own, but resolving them is further complicated by the upcoming presidential election and a parliament without a stable majority, where reaching a consensus often proves to be an impossible task,” noted Barclays strategists. They believe the medium-term outlook for the euro remains negative.

The presidential election in France will take place in April. Last week, the French National Assembly began debating next year’s budget. The government’s bill includes €43 billion ($48.2 billion) in measures to reduce the deficit and ease financial markets’ concerns about the state of the country’s public finances.

This article was AI-translated and verified by a human editor