Euro rises after France's first-round vote, yen struggles
euro rose on Monday after the first round of France's snap election put the far-right in pole position, though by a smaller margin than projected, while a downgrade to Japan's first-quarter growth figures knocked the yen lower.
Marine Le Pen's far-right National Rally (RN) party won the first round of France's parliamentary elections on Sunday, exit polls showed, although analysts noted the party won a smaller share of the vote than some polls had initially projected.
The euro, which has fallen some 0.8% since President Emmanuel Macron called the election on June 9, was last 0.24% higher at $1.0737, after having touched a more than one-week top of $1.0749 earlier in the session.
«They (RN) have actually performed a little bit worse than what was expected,» said Carol Kong, a currency strategist at Commonwealth Bank of Australia (CBA).
«As a result of that, we saw the euro rise modestly in early Asian trade just because we might actually get less fears of more expansionary and unsustainable fiscal policy if the far-right party did a little bit worse.»
The rise in the euro sent the dollar a touch lower against a basket of currencies, though the greenback was also reeling from data on Friday that showed U.S. inflation cooled in May, cementing expectations the Federal Reserve will begin cutting interest rates later this year.
Market pricing now points to about a 63% chance of a Fed cut in September, as compared to an even chance a month ago, according to the CME FedWatch tool.
Against the dollar, sterling rose
