Dollar Surges Against Euro Amid Bond Market Woes

The US dollar has reached its highest level against the euro in 17 months due to a selloff in government bonds across the US and Europe. The European currency, euro, fell below $1.123 for the first time since May 2025.

According to Brian Daingerfield, head of G10 FX strategy at NatWest Markets, 'higher yields have been driven by a confluence of factors in particular concern about fiscal policy including some weakness in French bond markets, which may be spilling over into global markets, as well as continued concern around energy prices and higher inflation.'

The yield on benchmark US 10-year notes hit its highest level since 2002 at 5.272 percent.