Euro plunges to 17-month low amid European debt concerns

The euro hit a 17-month low on Monday, sliding below $1.12 at one point before recovering slightly. The European currency’s lowest value since May 2025 reflects growing concerns over mounting government debt across the continent. At the start of the year, one euro was worth roughly $1.17, but its value has steadily declined, reaching $1.11 in May 2025.

A weaker euro strengthens the U.S. dollar in comparison, potentially making European exports cheaper while increasing the cost of American goods overseas. The U.S. had a $220.3 billion trade deficit with the European Union last year, importing $632.9 billion worth of goods.

The euro’s decline has been exacerbated by a global bond market sell-off, with rising public debt in Europe and elevated energy costs due to conflicts in Iran and Ukraine driving investors away. France’s and Germany’s 10-year bond yields rose sharply on Monday, closing at roughly $4.86 and $3.50, respectively.

Political uncertainty also played a role, as Spanish Prime Minister Pedro Sánchez called a snap election for Nov. 29 amid protests over a housing crisis. The election announcement contributed to further downward pressure on the euro.