Euro Stalls at $1.15 Amid Middle East Tensions and Weak German Data

2026-03-17 10:39 By Joana Ferreira 1 min. read

The euro held steady at $1.15, attempting to recover from a recent decline that saw it hit its lowest level since last July.

Investors remained focused on escalating Middle East tensions, disappointing German confidence data, and a packed week of central bank decisions.

US President Donald Trump suggested military operations in Iran would extend beyond this week, while Israeli officials warned the conflict could last "several more weeks." On the economic front, German investor morale plunged in March amid fears that rising prices could derail the country’s recovery.

Attention now turns to the European Central Bank’s policy meeting on Thursday, where interest rates are expected to remain unchanged and ECB President Christine Lagarde is anticipated to address how the bank plans to shield the eurozone from inflationary pressures tied to the conflict.

Markets now fully price in a July rate hike, with an 85% chance of a second increase by year-end.



News Stream
Euro at Two-Month Low on Middle East Tensions
The euro steadied just above $1.15, close to its weakest level since April 3, as renewed Middle East tensions stoked fears of a prolonged Iran conflict, exacerbating inflation concerns and dampening growth prospects. Brent crude surged over 4% after Iran and Israel exchanged missile strikes, despite calls from President Trump for both sides to cease hostilities and pursue peace talks. Investors also braced for a likely European Central Bank rate hike this week, with traders now pricing in three increases for the ECB and fully expecting the first hike as soon as June 11. This follows data showing euro-area inflation rose to 3.2% in May, its highest in over two and a half years. However, uncertainty lingers after Eurozone GDP figures were revised to show a contraction in Q1 2026, the first since late 2022 and the steepest since mid-2020.
2026-06-08
Euro Slides Toward 0.7% Weekly Loss
The euro erased early gains to trade below $1.16, hitting its lowest level since April 6 and heading for a 0.7% weekly loss, as investors flocked to the US dollar after stronger-than-expected US jobs data. Nonfarm payrolls surged by 172,000 in May, nearly double the forecasted 85,000, prompting markets to fully price in a Federal Reserve interest rate hike by year-end. At the same time, investors braced for a likely European Central Bank rate hike next week, while cautiously eyeing potential progress in Middle East resolution efforts. Markets now see a near-certain 25-basis-point ECB rate increase at the June 11 meeting, with two or possibly three hikes expected this year. This follows data showing euro-area inflation rose to 3.2% in May, its highest in over two and a half years. However, uncertainty lingers after Eurozone GDP figures were revised to show a contraction in Q1 2026, the first since late 2022 and the steepest since mid-2020.
2026-06-05
Euro Hits 8-week Low
EURUSD decreased to 1.16, the lowest since April 2026. Over the past 4 weeks, Euro US Dollar lost 1.46%, and in the last 12 months, it increased 1.59%.
2026-06-05