The euro experienced a significant decline, dropping more than 0.5% on Monday and reaching its lowest level since September 25, falling below $1.167. This downward movement appears to be linked to political instability in France.
- The euro fell more than 0.5% on Monday.
- It reached its weakest level since September 25, slipping below $1.167.
- French Prime Minister Sébastien Lecornu resigned.
- The resignation followed President Macron’s decision to keep his cabinet mostly unchanged.
- Opposition parties swiftly criticized Macron’s decision.
- Lecornu faced the task of passing a budget through a divided parliament.
- The upcoming fiscal plan is expected to include unpopular spending cuts and tax increases.
- These measures aim to curb France’s deficit, which is the largest in the Euro area.
- The situation is fueling political tension and investor concern.
The currency’s value is being negatively impacted by political turmoil in one of the Eurozone’s major economies. The resignation of a key political figure, coupled with anticipated austerity measures, is creating uncertainty and prompting investors to sell off the asset. The internal struggles within the Eurozone’s member states can weigh heavily on its value.