Euro Plunges as France's Fiscal Woes Weigh on Sentiment

The euro is on track for its biggest weekly fall against the dollar in months due to concerns over France's fiscal trajectory and the Federal Reserve's hawkish shift in mid-September.

After sliding on Thursday, the single currency rose 0.15% to $1.126 on Friday but was still down 1.17% for the week, its steepest drop since early June.

According to Jane Foley, senior forex strategist at Rabobank, the outlook for the euro is weakened due to low European gas storage levels, high energy prices, and competition from China.

The yield gap between French bonds and safe-haven Bunds widened to 150 basis points on Friday, its highest level since the euro area's sovereign debt crisis in 2011.