The euro fell to a one-month low as the French president called parliamentary elections in the country.
The euro exchange rate fell against the dollar after French President Emmanuel Macron decided to call early parliamentary elections after losing EU elections to the far right. The euro fell 0.5% to a one-month low of $1.0764, Reuters wrote.
“This is probably a bit of bad news for the markets. It brings an unexpected element of uncertainty,” said Berenberg chief economist Holger Schmieding.
Investors may also begin to question Europe’s commitment to closer monetary and fiscal integration, experts say. Traders will also need to factor political uncertainty into their bets.
This will be seen as a blow to the emerging positive sentiment towards the euro, which has begun to dominate currency markets in recent weeks.
“The last decade has shown that rising far-right sentiment in Europe can weaken the euro,” said Christopher Wong, a strategist at the Overseas-China Banking Corporation.
The European Central Bank last week cut interest rates for the first time in five years, and the currency has fallen nearly 2.5% against the dollar this year, mainly due to the relative prospects of interest rate cuts in the eurozone and the United States.
We remind you that according to the exit polls, the European People’s Party (EPP) will receive 189 seats in the European Parliament, followed by the Socialists and Democrats with 135 and political forces. Take back Europe with 83 places.
A group of conservatives and reformists in Europe, which includes parties such as Italian brothers Giorgi Meloni is expected to win 72 seats, while the far right Identity and democracy – 58.
As reported, the President of France, against the backdrop of exit polls on the results of the European Parliament elections, announced the dissolution of the National Assembly and called early parliamentary elections.
Source: korrespondent
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