The euro remains near 1.148, pressured not only by the stronger dollar but also by political and fiscal concerns in Europe. Germany’s CDU suffered a historic defeat in Mecklenburg-Western Pomerania, increasing pressure on Chancellor Friedrich Merz, while France faces renewed sovereign-risk concerns after Scope Ratings cut its rating and Morningstar DBRS shifted its outlook to negative.

Energy markets are providing some relief. Brent recovered toward $101 after four consecutive declines but remains well below recent highs as diplomacy surrounding the US-Iran conflict improves and Saudi crude flows through the Strait of Hormuz increase. Lower oil prices could gradually reduce inflation pressure and limit the need for aggressive central-bank tightening.

Gold remains near $4,350 as investors balance higher rate expectations against geopolitical uncertainty, central-bank demand and fiscal concerns. Meanwhile, USD/JPY has climbed toward 157.5 despite the BoJ’s recent rate hike, keeping intervention risk elevated.

Risk appetite remains mixed. US technology shares continue to outperform, while Bitcoin has slipped below $86,000. Attention now turns to Fed speeches, Middle East diplomacy and the Trump-Xi summit, where trade, AI and strategic commodities are expected to dominate discussions.