Euro Weakens Amid Rising Energy Prices and Political Risks
The euro has weakened by around 2% this month and fallen to a two-month low against the US dollar, reaching USD 1.14.
This decline is largely due to higher US interest rates and rising energy prices, which have increased concerns over economic growth in Europe.
Jane Foley, senior foreign exchange strategist at Rabobank, noted that the euro's outlook has become more uncertain amid political developments and a renewed rise in oil prices.
The conflict between Iran and other nations has disrupted liquefied natural gas shipments through the Strait of Hormuz, pushing European gas prices above €80 per megawatt hour this month.
Kaspar Hense, senior portfolio manager at RBC BlueBay Asset Management, expects the euro could weaken to around USD 1.12 if European gas prices remain high.