The euro just hit a 17-month low and Spain isn't the main problem

EUR/USD fell as much as 0.8% to $1.1161 in Asian trading, its weakest since May 2025, after Bloomberg reported Pedro Sanchez's allies are preparing for a possible November 29 election following a parliamentary defeat on housing decrees. Spain must dissolve parliament by October 6 to hit that date. But the euro has now fallen for four straight weeks and lost over 2% in September alone, its worst month in 14 years, and France is the bigger drag: French bond spreads over Germany keep widening as budget gridlock drags on with elections looming across France, Spain and Italy in 2027. Options traders are now at their most bearish on the euro since March. Watch October 6 for Sanchez's decision, but watch French yields harder.