Euro Falls Amid US Sanctions and Middle East Tensions

The euro fell against a basket of global currencies on Tuesday as investors sought safe-haven assets amid renewed military tensions in the Middle East. The US dollar index rose 0.1% to 105.31, extending gains for a second consecutive session.

US Treasury Secretary Scott Bessent announced the launch of the 'Economic Pariah' campaign aimed at imposing comprehensive international isolation on Iran, targeting five additional critical sectors: digital assets, technology, gold, aviation, and shipping.

The US Treasury imposed sanctions on nearly 60 Iran-linked entities, individuals, and vessels spanning the nuclear, missile, cybersecurity, and oil sectors. Money markets currently price the probability of a 25-basis-point interest rate hike by the European Central Bank in September at around 50%.