[Danske Bank: French Fiscal Risks Weaken ECB Rate Hike Expectations, Euro May Weaken Further] According to a report by Danske Bank analyst Jesper Fjarstedt on October 28th, concerns over the French fiscal situation suggest the euro has room to fall further. Currently, the euro has fallen to a 17-month low against the US dollar. He stated, "The market is beginning to doubt the necessity of a near-term rate hike by the ECB, a stark contrast to September, when the market was almost certain the ECB would raise rates at its meeting the following day." He pointed out that the market expects the ECB to keep rates unchanged on Thursday, and expectations for a December rate hike have fallen to less than 80%. Danske Bank still expects the ECB to raise rates in December, but believes that the current tightening cycle will end by then. If this assessment is correct, then the market is currently pricing in the ECB's policy rate one year from now at approximately 45 basis points higher.