{"id":638603,"date":"2026-10-07T01:32:13","date_gmt":"2026-10-07T01:32:13","guid":{"rendered":"https:\/\/www.newsbeep.com\/il\/638603\/"},"modified":"2026-10-07T01:32:13","modified_gmt":"2026-10-07T01:32:13","slug":"the-euro-drops-to-17-month-low-amid-french-debt","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/il\/638603\/","title":{"rendered":"The euro drops to 17-month low amid French debt"},"content":{"rendered":"

The euro hit a 17-month low<\/a> against the dollar on Monday, largely on concerns over the growing debt crisis in France.<\/p>\n

France is running a major deficit. Its borrowing costs are rising, and pretty soon it\u2019s going to have to refinance a lot of debt that it borrowed back when interest rates were much lower \u2014 that\u2019s not a great combination.<\/p>\n

For more than a decade from the Great Recession through the pandemic, interest rates were historically low.<\/p>\n

\u201cLeading economists, people on Wall Street, at central banks, all thought interest rates would stay low forever,\u201d said Kenneth Rogoff, a professor of economics at Harvard University and former chief economist at the International Monetary Fund.<\/p>\n

He said that governments thought so too, so they borrowed a lot.<\/p>\n

\u201cThey said, \u2018Oh, and don’t bother borrowing long-term,\u2019\u201d Rogoff said. \u201cIn other words, taking out a 30-year mortgage instead of a flexible-rate mortgage<\/a>. \u2018The flexible rate borrowing is cheaper. Do short-term borrowing.\u2019\u201d<\/p>\n

Some countries did that more than others, he said \u2014 and France was one of them.<\/p>\n

Paul Christopher, head of global investment strategy for Wells Fargo Investment Institute, said that now, it\u2019s coming time for France to refinance a lot of that debt, and interest rates are much higher<\/a>.<\/p>\n

\u201cImagine yourself in a mortgage situation,\u201d Christopher said. \u201cYou borrowed at 2.5%, but now you want to move, and now the mortgage rate is 7%. Well, that’s going to make a huge difference in your monthly payment. That’s exactly what’s happening in France and in other countries.\u201d<\/p>\n

And in France, it\u2019s happening at a time of political instability.<\/p>\n

Veronique de Rugy, George Gibbs Chair in Political Economy at the Mercatus Center at George Mason University, said that ahead of presidential elections next year, candidates are offering different solutions.<\/p>\n

\u201cOne guy is talking about erasing the debt<\/a> and basically defaulting,\u201d she said. \u201cThe other one wants to reverse the retirement age reform<\/a> to basically allow French people to retire at 60, which was a source of the financial problem of the country.\u201d<\/p>\n

All of this chaos is making investors nervous, she said, and less inclined to buy French bonds.<\/p>\n

\u201cIt’s not just that people aren’t buying \u2014 they’re selling off French government bonds,\u201d she said.<\/p>\n

And they\u2019re selling euros, too, spooked by the turmoil.<\/p>\n

Related Topics<\/p>\n","protected":false},"excerpt":{"rendered":"The euro hit a 17-month low against the dollar on Monday, largely on concerns over the growing debt…\n","protected":false},"author":2,"featured_media":638604,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[40174,10272,23913,2226,42,4486,43,40,38,41,39],"class_list":["post-638603","post","type-post","status-publish","format-standard","has-post-thumbnail","category-headlines","tag-borrowing","tag-euro","tag-european-economy","tag-france","tag-headlines","tag-interest-rates","tag-news","tag-top-news","tag-top-stories","tag-topnews","tag-topstories"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/638603","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/comments?post=638603"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/638603\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media\/638604"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media?parent=638603"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/categories?post=638603"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/tags?post=638603"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}