The euro EU0009652759 rose above $1.17 on Thursday, reaching its highest level in more than three and a half years.

In the early morning, the common currency temporarily traded at $1.1717. The price was last at that high in September 2021. However, as trading continued, the euro gave up some of its early gains and was last trading below $1.17.

The euro once again benefited from a weak dollar. Speculation intensified in the foreign exchange market that the US Federal Reserve might cut interest rates sooner than previously expected. With the prospect of falling interest rates, the dollar was under pressure in morning trading against all other major currencies, while the euro gained in return.

The market referred to a report in the business newspaper "Wall Street Journal" regarding the successor to US Federal Reserve Chairman Jerome Powell. According to this report, US President Donald Trump could decide on the successor as early as September or October, even though Powell is in office until May 2026. This unusually early appointment could create a shadow Fed chairman.

Trump has recently sharply criticized incumbent Fed Chairman Powell on several occasions and vehemently called for an interest rate cut. Media reports about the possible early succession have reinforced market expectations that interest rates in the US could fall sooner than previously thought.