Euro Set to End March 2% Weaker

2026-03-30 09:16 By Joana Ferreira 1 min. read

The euro slipped to $1.15 by the end of March, flirting with its weakest level since mid-March and heading for a monthly drop of over 2% against the dollar.

Risk aversion intensified as traders weighed the economic fallout from the worsening Middle East conflict, with reports of US troop preparations for a possible ground operation eclipsing Washington’s claims of progress in Iran talks.

Economic data added to the pressure: German CPI pointed to rising inflation in Europe’s largest economy, while the Eurozone business survey showed a steep decline in sentiment as inflation expectations spiked.

Markets have radically repriced ECB policy, now anticipating at least two rate hikes in 2026, and potentially a third, ditching earlier expectations of a 40% chance of a cut.

Meanwhile, French central bank chief François Villeroy de Galhau stressed the ECB’s resolve to contain energy-driven inflation, though he cautioned it was “too early” to discuss specific timing for rate increases.



News Stream
Euro Set to End March 2% Weaker
The euro slipped to $1.15 by the end of March, flirting with its weakest level since mid-March and heading for a monthly drop of over 2% against the dollar. Risk aversion intensified as traders weighed the economic fallout from the worsening Middle East conflict, with reports of US troop preparations for a possible ground operation eclipsing Washington’s claims of progress in Iran talks. Economic data added to the pressure: German CPI pointed to rising inflation in Europe’s largest economy, while the Eurozone business survey showed a steep decline in sentiment as inflation expectations spiked. Markets have radically repriced ECB policy, now anticipating at least two rate hikes in 2026, and potentially a third, ditching earlier expectations of a 40% chance of a cut. Meanwhile, French central bank chief François Villeroy de Galhau stressed the ECB’s resolve to contain energy-driven inflation, though he cautioned it was “too early” to discuss specific timing for rate increases.
2026-03-30
Euro Heads for Over 2% Monthly Loss as Middle East Risks Weigh
The euro held steady at $1.15 by the end of March, poised for a monthly decline of over 2% against the US dollar. Traders offloaded riskier assets as concerns mounted over the economic fallout from the escalating Middle East conflict, with reports suggesting thousands of US troops were preparing for a potential ground operation, despite Washington’s insistence that diplomatic talks with Iran were progressing. Investors also turned their attention to a wave of key economic data due this week, including March inflation flash estimates from Europe’s major economies. Market sentiment has shifted sharply on ECB policy, with traders now pricing in at least two interest rate hikes this year and a growing possibility of a third, abandoning earlier expectations of a 40% chance of a rate cut in 2026.
2026-03-30
Euro Under Pressure Amid US-Iran Tensions and Spanish Inflation Jump
The euro edged lower to $1.152 as traders weighed the latest in US-Iran negotiations, including a 10-day extension of President Donald Trump’s deadline for a deal to April 6. While German Foreign Minister Johann Wadephul confirmed indirect contacts and upcoming direct talks in Pakistan, the muted market reaction suggests skepticism that a breakthrough is imminent, with President Trump seen as buying time to bolster military presence in the region. Meanwhile, Spain’s inflation surged to 3.3% in March, the highest since June 2024, though below expectations of 3.9%. The shift in ECB policy expectations has been stark: traders now price in at least two interest rate hikes this year, with a strong chance of a third, reversing earlier bets on a 40% likelihood of a 2026 cut.
2026-03-27