Euro weakens toward $1.14 as oil drop trims ECB rate-hike bets

  • Euro weakened toward $1.14 as traders reduced expectations for further ECB rate hikes.
  • Brent crude fell below $100 a barrel amid US-Iran talks and Saudi pipeline restoration efforts.
  • Eurozone private-sector activity expanded in September at its fastest pace in almost three-and-a-half years.

The euro weakened toward $1.14 and touched its lowest level since July 29 as falling oil prices led traders to reduce expectations for additional European Central Bank rate hikes. Brent crude fell below $100 a barrel amid signs of progress in US-Iran talks and ongoing efforts to restore operations at a key Saudi Arabian pipeline. The dollar remained supported by expectations of further Federal Reserve tightening. ECB official Joachim Nagel said oil prices were becoming increasingly important for policymakers and left open the possibility of more rate increases, pointing to still-high core inflation while saying he had not seen significant second-round effects so far. ECB Chief Economist Philip Lane cautioned that another energy-price surge could keep eurozone inflation elevated for longer than previously expected. At the same time, stronger-than-expected flash PMI data showed eurozone private-sector activity expanding in September at its fastest pace in almost three-and-a-half years.

The information on this website is generated using AI and we cannot guarantee its accuracy. Please use it as reference information only.