Daily Morning Report 07.02.2017
The dollar climbed against a currency basket on Tuesday, boosted by the weaker euro as concerns over political uncertainty pressured the single currency lower.
EUR/USD hit more than one-week lows of 1.0662 and was last at 1.0663, down 0.77% for the day.
Sentiment on the euro was hit by concerns over the possibility of a Brexit or Trump-style shock result in France’s upcoming presidential election this spring.
Marine Le Pen, head of the far-right National Front party, launched her presidential bid on Sunday with promises to exit the euro zone and protect France against globalization.
Worries over Greece’s bailout and a narrowing of opinion polls in Germany also added to investor jitters.
The single currency came under additional selling pressure after European Central Bank President Mario Draghi on Monday downplayed calls for the bank to scale back its stimulus program.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, climbed 0.78% to 100.62.
Against the yen the dollar was higher, with USD/JPY adding 0.46% to 112.23, pulling back from overnight lows of 111.58, the weakest since November 29.
The dollar has weakened against the safe haven yen amid a lack of clarity on U.S. President Donald Trump’s economic policies.
Sterling was lower, with GBP/USD down 0.82% at 1.2367 as parliamentary debate on a law giving Prime Minister Theresa May the right to trigger Brexit was set to continue for a second day.
Meanwhile, the Australian dollar was lower, with AUD/USD falling 0.44% to 0.7624.
The Reserve Bank of Australia held interest rates steady at its first policy meeting of 2017 on Tuesday and said a recent soft patch in growth was temporary and would not prevent a healthy pickup over time.