Sun, Apr 23, 2017 - Page 14 News List

Euro steadies near US$1.07 as traders await French vote

ELECTION JITTERS:The euro fell against most of its G10 peers, but gained 0.8 percent against the US dollar, which lost ground to the Japanese yen

Bloomberg

The US dollar on Friday maintained gains for the session while the euro stayed near US$1.07 ahead of the first round of the French presidential elections, with trading flows largely tied to position tweaking before an opinion poll blackout began Friday night.

The greenback rose versus a majority of its G10 peers, trading as high as ¥109.33 after US President Donald Trump told The Associated Press that the White House will release a tax plan next week.

He said businesses and individuals will receive a “massive tax cut,” but did not provide more details.

The US dollar index, which tracks the US currency against a basket of six major rivals, was 99.75 on Friday, down 0.8 percent from last week’s 100.58.

In Taipei, the New Taiwan dollar rose against the greenback, gaining NT$0.045 to close at NT$30.363, down 0.1 percent from last week’s NT$30.400.

The US dollar advanced to a fresh five-week high against the Canadian dollar, which fell to near this year’s low at US$1.3535.

Canada’s inflation data for last month missed estimates, likely reinforcing Bank of Canada concerns about weak underlying dynamics in the economy, thereby deflating any expectations for near-term rate hikes.

Today’s first round of the French presidential election is seen as a close race between the four leading contenders who are in a virtual dead-heat when poll readings are adjusted for the margin of error.

Traders and investors are trying to finesse the multitude of possible outcomes.

On Friday, the euro fell on the day against a majority of its G10 peers, though it has gained about 0.8 percent against the US dollar over the past week and was trading close to this month’s high.

Yen is seen as a potential beneficiary of haven flows if the French vote outcome elevates risks to the euro.

The US dollar had earlier dropped to session low against the yen as equities declined, but the drop was cushioned by bids under ¥109, traders in Europe said.

The euro traded near US$1.07 after extending its retreat from Thursday’s peak at US$1.0778, highest for the month.

Flows are muted as positions are trimmed and as traders try to avoid significant risk over the weekend.

Euro stop-loss sell orders are positioned below US$1.0680, while offers to sell are stacked above US$1.0750, said traders familiar with the transactions who asked not to be identified because they are not authorized to speak publicly.

Additional reporting by CNA and Reuters

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