Euro Weakens to Fresh Three-Month Low

2026-03-12 07:42 By Joana Ferreira 1 min. read

The euro extended its decline toward $1.15, reaching its weakest level since November 24, as persistent uncertainty surrounding the Middle East conflict strengthened the US dollar and heightened concerns about rising inflation in the eurozone.

Oil prices resumed their rally, briefly climbing above $100 per barrel after Iran intensified attacks on oil and transportation infrastructure across the region.

Meanwhile, the International Energy Agency’s announcement of a 400-million-barrel release from strategic oil reserves provided little immediate relief to markets, as it may take weeks or even months for the supply to reach buyers.

Money markets are now fully pricing in a European Central Bank interest rate hike by July, with an 85% probability of a second increase by December.

This marks a sharp shift in expectations from late February, before the outbreak of the Iran war, when traders had assigned roughly a 40% chance that the ECB would cut rates before the end of the year.



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