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Euro hits fresh lows on Spain early election talk, then rebounds

EUR/USD slid to its weakest level since May 2025 before recovering more than half and trading back above 1.1200, after Spain confirmed a November 29 vote.

Reported · Written up by our desk · Major Pairs

FXStreet reports that talk Spain’s government was preparing an early election pushed EUR/USD to its lowest level since May 2025. Traders said hedge-fund selling in Asia triggered option barriers that deepened the selloff.

The pair has since rebounded, recovering more than half of the drop and trading back above 1.1200, according to FXStreet. Prime Minister Sánchez’s confirmation of a November 29 vote after parliament rejected his housing plan was described as doing less damage than earlier reports.

FXStreet also cited comments from European Central Bank officials, with ECB Chief Economist Lane saying costlier energy and higher long-term borrowing costs are already slowing demand, potentially limiting how far rates need to rise. Bundesbank President Nagel said there are no clear signs yet of inflation feeding into wages and price-setting, and FXStreet noted euro area inflation was 3.8% in September.

FXStreet added that the ECB’s deposit rate is 2.50% following June and September increases, while money markets price two to three more rate moves over the coming year.

Latest closeEUR/USD 1.123 ▼0.2%

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