Along with the expectations of further European Central Bank stimulus reduction, the euro reached a roughly six-month high against the U.S. dollar on Thursday; on greater certainty centrist Emmanuel Macron will win France’s presidential election. The euro rose to $1.0984 USD, its highest since November 2016, followed after centrist: Emmanuel Macron, in a Wednesday debate with anti-EU candidate Marine Le Pen, consolidate his position as the likely winner of France’s presidency.
In accordance to this event, the removal of that political uncertainty, combined with the expectations that the ECB could take a more aggressive tone on stimulus next month, surely did helped the euro. Following the fall of dollar against yen which went to as low as 112.33JPY=yen after nearly touching a seven-week high of 113.04 yen.
Sebastien Galy, currency strategist at Deutsche Bank in New York, said that traders were likely taking profits on the dollar’s gain against the yen, causing it to slip from its multi-week peak. He also gave a comment regarding France’s presidential election and said that Macron will indefinitely win the election.
On the other hand, capital markets professionals have begun looking to a new environment without European Central Bank Stimulus—for several weeks, but with the assumption that Macron will win sharpened traders’ focus on higher European yields a stronger euro as the effect of less ECB stimulus.
In accordance to this, Oanda’s chief currency strategist: Dean Popplewell, commented: that everybody is still waiting for ECB President, Mario Draghi to mention a potential tapering timetable.