{"id":32063,"date":"2025-10-13T07:58:45","date_gmt":"2025-10-13T07:58:45","guid":{"rendered":"https:\/\/www.vtmarkets.com\/?p=32063"},"modified":"2025-10-13T07:58:45","modified_gmt":"2025-10-13T07:58:45","slug":"euro-holds-near-2-month-low-on-political-risks","status":"publish","type":"post","link":"https:\/\/www.vtmarkets.com\/en-asia\/analysis\/euro-holds-near-2-month-low-on-political-risks\/","title":{"rendered":"Euro Holds Near 2-Month Low on Political Risks"},"content":{"rendered":"\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"559\" src=\"https:\/\/www.vtmarkets.com\/en-asia\/wp-content\/uploads\/sites\/27\/2026\/03\/Image_fx-2025-10-03T175502582-1024x559.png\" alt=\"\" class=\"wp-image-31522\" \/><\/figure>\n\n\n\n<p><strong>Key Points<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>EUR\/USD trades near $1.16, close to last week\u2019s two-month low of $1.154.<\/li>\n\n\n\n<li>Markets await France\u2019s draft budget amid renewed political uncertainty.<\/li>\n<\/ul>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity is-style-dots\" \/>\n\n\n\n<p>The <strong>euro<\/strong> hovered near <strong>$1.16<\/strong> on Monday, holding close to its lowest level in over two months as traders monitored fresh political developments in <strong>France<\/strong> and subtle shifts in <strong>US-China trade relations<\/strong>.<\/p>\n\n\n\n<h2 class=\"wp-block-heading has-medium-font-size\">France\u2019s Budget Test<\/h2>\n\n\n\n<p>In France, political volatility continued after Prime Minister <strong>Sebastien Lecornu<\/strong> resigned 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 <strong><a href=\"https:\/\/t.co\/Z3Pa3CfN7b\" target=\"_blank\" rel=\"noopener\" title=\"\">draft budget bill<\/a><\/strong>, 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 <strong>Socialists<\/strong> and <strong>centre-right Republicans<\/strong> to 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 has-medium-font-size\">US-China Dynamics<\/h2>\n\n\n\n<p>Meanwhile, geopolitical sentiment improved slightly after <strong>US President Donald Trump<\/strong> adopted a more conciliatory tone toward <strong>China<\/strong>, just days after threatening <strong>100% tariffs<\/strong> on 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 Beijing\u2019s decision 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 <strong><a href=\"https:\/\/t.co\/VVpLumK1gB\" target=\"_blank\" rel=\"noopener\" title=\"\">European Central Bank (ECB)<\/a><\/strong>, 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 has-medium-font-size\">Technical Analysis<\/h2>\n\n\n\n<p>The <strong>EUR\/USD<\/strong> pair is trading around <strong>1.16046<\/strong>, slightly lower by <strong>0.14%<\/strong>, 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 European Central Bank\u2019s cautious tone against the Federal Reserve\u2019s commitment to keeping interest rates elevated for longer.<\/p>\n\n\n\n<p>From a <strong>technical standpoint<\/strong>, EUR\/USD has shifted into a mildly bearish posture. The pair has fallen below its <strong>5- and 10-day moving averages<\/strong>, while the <strong>30-day moving average<\/strong> is beginning to flatten, signalling potential loss of bullish momentum.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" src=\"https:\/\/www.vtmarkets.com\/en-asia\/wp-content\/uploads\/sites\/27\/2026\/03\/image-16-1024x446.jpg\" alt=\"\" class=\"wp-image-32065\" \/><\/figure>\n\n\n\n<p>The recent rejection from the <strong>1.1918<\/strong> resistance level marks the formation of a short-term top, with price action now testing the key <strong>support area at 1.1550\u20131.1580<\/strong>. A clear break below this zone could open the path toward <strong>1.1450<\/strong>, a level last seen in mid-summer 2025.<\/p>\n\n\n\n<p>The <strong>MACD<\/strong> has 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 <strong>fundamental side<\/strong>, 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 <strong><a href=\"https:\/\/t.co\/mwXgV6kf9l\" target=\"_blank\" rel=\"noopener\" title=\"\">U.S. dollar remains supported<\/a><\/strong> by 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><strong><a href=\"https:\/\/www.vtmarkets.com\/trade-now\/\" target=\"_blank\" rel=\"noopener\" title=\"\">Create your live VT Markets account<\/a> and <a href=\"https:\/\/myaccount.vtmarkets.com\/login?_gl=1*5vyjdn*_gcl_au*Njc1MzM0NjY0LjE3NTEzNTM4MTc.*_ga*MjA5ODA0NDIzNC4xNzI3OTE1ODQ1*_ga_J26NL1ZVX7*czE3NTE4NzkxMDYkbzMwOCRnMSR0MTc1MTg3OTExOCRqNDgkbDAkaDA.*_ga_6XQ8153GYW*czE3NTE4NzkxMDgkbzU3JGcxJHQxNzUxODc5MTE4JGo1MCRsMCRoMA..*_ga_BG6LYEHPX1*czE3NTE4NzkxMDgkbzUkZzEkdDE3NTE4NzkxMTgkajUwJGwwJGgw*_ga_J8BRGZSREX*czE3NTE4NzkxMDgkbzUkZzEkdDE3NTE4NzkxMjIkajQ2JGwwJGgw*_ga_7CG6454YR5*czE3NTE4NzkxMDgkbzUkZzEkdDE3NTE4NzkxMjIkajQ2JGwwJGgw*_ga_69Z54R4H9N*czE3NTE4NzkxMDgkbzUkZzEkdDE3NTE4NzkxMjIkajQ2JGwwJGgw*_ga_CY2VCKFC3C*czE3NTE4NzkxMDgkbzUkZzEkdDE3NTE4NzkxMjIkajQ2JGwwJGgw*_ga_TXZ07R2C21*czE3NTE4NzkxMDgkbzUkZzEkdDE3NTE4NzkxMjUkajQzJGwwJGgw*_ga_17TMGY9BBE*czE3NTE4NzkxMDgkbzUkZzEkdDE3NTE4NzkxMjUkajQzJGwwJGgw*_ga_MWDVVSEVL5*czE3NTE4NzkxMDgkbzUkZzEkdDE3NTE4NzkxMjUkajQzJGwwJGgw*_ga_2QCC3S2748*czE3NTE4NzkxMDgkbzUkZzEkdDE3NTE4NzkxMjUkajQzJGwwJGgw*_ga_E7D2PCX624*czE3NTE4NzkxMjYkbzUkZzAkdDE3NTE4NzkxMjYkajYwJGwwJGgw*_ga_XJ4037XKK6*czE3NTE4NzkxMjYkbzUkZzAkdDE3NTE4NzkxMjYkajYwJGwwJGgw*_ga_EJCVQDC7VT*czE3NTE4NzkxMDgkbzUkZzEkdDE3NTE4NzkxMjYkajQyJGwwJGgw\" target=\"_blank\" rel=\"noopener\" title=\"\">start trading<\/a> now.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The euro held around $1.16 on Monday as traders weighed political turbulence in France and easing tensions between the United States and China. &#8211; vtmarkets.com<\/p>\n","protected":false},"author":64,"featured_media":31522,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[31],"tags":[56,10],"class_list":["post-32063","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-analysis","tag-euro","tag-forex"],"acf":{"acf_article_selection_author":""},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/posts\/32063","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/users\/64"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/comments?post=32063"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/posts\/32063\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/media\/31522"}],"wp:attachment":[{"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/media?parent=32063"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/categories?post=32063"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/tags?post=32063"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}