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Euro hits 17-month low as French debt fears mount and Spain heads for snap election

The euro slid to its weakest level against the US dollar since May 2025 on Monday, as France's debt troubles and Spain's political turmoil, capped by a snap election call, fuelled fears of a fresh eurozone crisis and of contagion across the bloc's bond markets.

READ MORE : http://www.euronews.com/2026/10/05/euro-hits-17-month-low-as-french-debt-fears-mount-and-spain-heads-for-snap-election

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00:00The Euro has fallen to its lowest level against the dollar in 17 months, touching $1.1161 after
00:08four straight weeks of losses.
00:12This comes as political and fiscal worries in France and Spain are reviving memories
00:17of the Eurozone debt crisis.
00:19In France, the gap between French and German 10-year bond yields is around 146 basis points,
00:26its biggest weekly jump in 17 years, and the French 10-year yield is close to a 24-year
00:33high.
00:34Spain added to the political uncertainty on Monday, when Prime Minister Pedro Sanchez called
00:39a snap general election, after the parliament rejected two of his minority government's
00:45housing decrees on Friday.
00:46But even so, Spain's premium over Germany is around 65 basis points, less than half
00:53of France's.
00:55Fears of contagion are growing, with Italian, Belgian and Greek bonds also hit last week.
01:02The European Central Bank has raised rates twice since June, with inflation at 3.8%.
01:09ECB President Christine Lagarde called France's debt a serious matter, but insisted this is
01:15not 2008 or 2011.
01:18The European Central Bank has raised rates twice since June, but not 2008 or 2011.
01:18The European Central Bank has raised rates twice since June, but not 2008 or 2011.
01:20The European Central Bank has raised rates twice since June, butche the European Central Bank has

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