Dollar Surges Against Euro as Interest-Rate Gaps Widen

The US dollar has recorded its strongest monthly performance against the euro in 14 months, with cumulative gains approaching 2.5% in September.

This is due to interest-rate differentials re-emerging as the dominant pricing force in currency markets, driven by US economic resilience and rate expectations that underpin the appeal of dollar-denominated assets.

Meanwhile, Europe faces soaring energy costs and French fiscal pressures that have left the euro lacking any rebound momentum.

The EUR/USD briefly touched $1.1312 on Monday, its lowest level since May 2025, and is currently trading near $1.1334.