Euro Unlikely to Rise Much Even as U.s.-iran Tensions Boost ECB Rate-rise Bets

Dow Jones07-10

0731 GMT - Recent military strikes between the U.S. and Iran have boosted expectations for another interest-rate rise by the European Central Bank but the euro has limited scope to benefit, ING's Francesco Pesole says in a note. The re-escalation has prompted a re-tightening in euro-dollar short-term swap differentials. "While all this is injecting new confidence into previously dwindling expectations for a September ECB hike, the path for euro-dollar to come out stronger from this re-escalation is quite narrow." The euro could stabilize versus the dollar Friday as markets wait for more clarity on the situation but there is a risk of it falling back below $1.14, he says. The euro rises 0.1% to $1.1438.(renae.dyer@wsj.com)

 

(END) Dow Jones Newswires

July 10, 2026 03:31 ET (07:31 GMT)

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