Euro stumbles toward 17-month lows, dollar rises with Fed minutes on tap
TLT•The euro fell 0.65% to $1.1185, nearing 17-month lows, while the dollar index rose 0.41% to 102.33 ahead of the Fed’s September meeting minutes. Markets put the odds of an October rate hike at 21.6%, down from about 38% a week earlier.
1. Euro weakens
The euro fell as French bonds came under renewed pressure over fiscal concerns. France’s 10-year yield rose 14.9 basis points to 4.8959%, while Germany’s 10-year yield edged up 0.8 basis point to 3.489%.
2. Dollar and Fed outlook
The dollar index climbed 0.41% to 102.33 as investors awaited minutes from the Fed’s September meeting, when it raised interest rates for the first time since 2023. Markets priced in a 21.6% chance of a hike of at least 25 basis points at the Fed’s later-this-month meeting, down from about 38% a week earlier, and an 82.8% chance of a hike in December.
3. Other currency moves
Sterling weakened 0.45% to $1.3212 against the dollar and reached its highest level since June 2025 against the euro. The dollar edged up 0.03% to 158.16 yen; Bank of Japan policymaker Ayano Sato said she supported raising interest rates in several stages.
