{"id":48103,"date":"2025-10-13T16:43:58","date_gmt":"2025-10-13T16:43:58","guid":{"rendered":"https:\/\/www.vtmarkets.com\/?p=29497"},"modified":"2025-10-13T16:43:58","modified_gmt":"2025-10-13T16:43:58","slug":"euro-holds-low-in-the-face-of-political-risks","status":"publish","type":"post","link":"https:\/\/www.vtmarkets.com\/de-eu\/analysis\/euro-holds-low-in-the-face-of-political-risks\/","title":{"rendered":"Euro holds low in the face of political risks"},"content":{"rendered":"\n<p>The\u00a0euro\u00a0hovered near\u00a0$1.16\u00a0on Monday, holding close to its lowest level in over two months as traders monitored fresh political developments in\u00a0France\u00a0and subtle shifts in\u00a0US-China trade relations.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Budget test of France<\/h2>\n\n\n\n<p>In France, political volatility continued after Prime Minister\u00a0Sebastien Lecornu\u00a0resigned last week, only to be swiftly reappointed on Friday.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"twitter-tweet\" data-width=\"500\" data-dnt=\"true\"><p lang=\"en\" dir=\"ltr\">The French presidency announced Prime Minister Sebastien Lecornu&#39;s new cabinet line-up, with most top jobs remaining unchanged despite demands by opponents for a political shift <a href=\"https:\/\/t.co\/5QiMfBvmkg\">https:\/\/t.co\/5QiMfBvmkg<\/a> <a href=\"https:\/\/t.co\/BJu1lSzLc0\">pic.twitter.com\/BJu1lSzLc0<\/a><\/p>&mdash; Reuters (@Reuters) <a href=\"https:\/\/twitter.com\/Reuters\/status\/1977608990625288198?ref_src=twsrc%5Etfw\">October 13, 2025<\/a><\/blockquote><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script>\n<\/div><\/figure>\n\n\n\n<p>Lecornu faces a significant test today as he presents a\u00a0draft budget bill, navigating a tight parliamentary landscape where maintaining stability is crucial.<\/p>\n\n\n\n<p>Lecornu is attempting to secure enough abstentions or conditional support from both the\u00a0Socialists\u00a0and\u00a0centre-right Republicans\u00a0to pass the budget. Encouragingly, most deputies have expressed opposition to dissolving parliament, suggesting a potential pathway for budget approval and avoiding a new round of elections.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">US-China dynamics<\/h2>\n\n\n\n<p>Meanwhile, geopolitical sentiment improved slightly after\u00a0US President Donald Trump\u00a0adopted a more conciliatory tone toward\u00a0China, just days after threatening\u00a0100% tariffs\u00a0on Chinese imports.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"twitter-tweet\" data-width=\"500\" data-dnt=\"true\"><p lang=\"en\" dir=\"ltr\">Traders return from the weekend after Donald Trump raised the threat of a \u201cmassive increase\u201d in tariffs on Chinese goods, which he said would involve an additional 100% levy beginning Nov. 1. <a href=\"https:\/\/t.co\/CIo4iVkt5q\">https:\/\/t.co\/CIo4iVkt5q<\/a><\/p>&mdash; Bloomberg (@business) <a href=\"https:\/\/twitter.com\/business\/status\/1977451721224835180?ref_src=twsrc%5Etfw\">October 12, 2025<\/a><\/blockquote><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script>\n<\/div><\/figure>\n\n\n\n<p>The softer rhetoric followed the decision by Beijing to tighten export controls on rare earth minerals, a move that had briefly escalated trade tensions.<\/p>\n\n\n\n<p>The euro remains under modest pressure as traders favour the US dollar amid its safe-haven appeal and relatively stronger growth outlook. Market participants are also watching for cues from the\u00a0European Central Bank (ECB), which has maintained a cautious tone on monetary policy, balancing inflation risks with signs of slowing activity.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Technical analysis: EUR\/USD<\/h2>\n\n\n\n<p>The\u00a0EUR\/USD\u00a0pair is trading around\u00a01.16046, slightly lower by\u00a00.14%, as the euro continues to consolidate near its recent lows amid persistent dollar strength and mixed eurozone data. The pair remains under modest selling pressure, with traders weighing the cautious tone of the ECB against the commitment of the Fed to keeping interest rates elevated for longer.<\/p>\n\n\n\n<p>From a\u00a0technical standpoint, EUR\/USD has shifted into a mildly bearish posture. The pair has fallen below its\u00a05- and 10-day moving averages, while the\u00a030-day moving average\u00a0is beginning to flatten, signalling potential loss of bullish momentum.<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/www.vtmarkets.com\/de-eu\/wp-content\/uploads\/sites\/17\/2026\/04\/image-16-1024x446.jpg\" alt=\"eurusd\" class=\"wp-image-32065\" title=\"image - VT Markets\" \/><\/figure>\n\n\n\n<p>The recent rejection from the\u00a01.1918\u00a0resistance level marks the formation of a short-term top, with price action now testing the key\u00a0support area at 1.1550 to 1.1580. A clear break below this zone could open the path toward\u00a01.1450, a level last seen in mid-summer 2025.<\/p>\n\n\n\n<p>The\u00a0MACD\u00a0has turned bearish, with the signal line crossing above the MACD line and the histogram entering negative territory.<\/p>\n\n\n\n<p>This momentum shift reinforces the likelihood of continued downside pressure in the near term unless the pair finds renewed buying interest around current levels.<\/p>\n\n\n\n<p>On the\u00a0fundamental side, the euro has been weighed down by weak manufacturing and industrial output data across the bloc, alongside political tensions in France and Italy that are dampening investor confidence.<\/p>\n\n\n\n<p>Meanwhile, the\u00a0U.S. dollar remains supported\u00a0by safe-haven flows amid ongoing fiscal uncertainty in Washington and strong U.S. economic indicators, including retail sales and labour data.<\/p>\n\n\n\n<p>Click\u00a0<a href=\"https:\/\/www.vtmarkets.net\/trade-now\/?utm_campaign=account_c&amp;utm_source=dma&amp;utm_medium=website\" target=\"_blank\" rel=\"noreferrer noopener\">here<\/a>\u00a0to open account and start trading.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The\u00a0euro\u00a0hovered near\u00a0$1.16\u00a0on Monday, holding close to its lowest level in over two months as traders monitored fresh political developments in\u00a0France\u00a0and subtle shifts in\u00a0US-China trade relations. Budget test of France In France, political volatility continued after Prime Minister\u00a0Sebastien Lecornu\u00a0resigned last week, only to be swiftly reappointed on Friday. Lecornu faces a significant test today as he <a href=\"https:\/\/www.vtmarkets.com\/de-eu\/analysis\/euro-holds-low-in-the-face-of-political-risks\/\" class=\"read-more\">Continue Reading<\/a><\/p>\n","protected":false},"author":102,"featured_media":29453,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[28],"tags":[],"class_list":["post-48103","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-analysis"],"acf":{"acf_article_selection_author":null},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.vtmarkets.com\/de-eu\/wp-json\/wp\/v2\/posts\/48103","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.vtmarkets.com\/de-eu\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarkets.com\/de-eu\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/de-eu\/wp-json\/wp\/v2\/users\/102"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/de-eu\/wp-json\/wp\/v2\/comments?post=48103"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarkets.com\/de-eu\/wp-json\/wp\/v2\/posts\/48103\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/de-eu\/wp-json\/wp\/v2\/media\/29453"}],"wp:attachment":[{"href":"https:\/\/www.vtmarkets.com\/de-eu\/wp-json\/wp\/v2\/media?parent=48103"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/de-eu\/wp-json\/wp\/v2\/categories?post=48103"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/de-eu\/wp-json\/wp\/v2\/tags?post=48103"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}