Image: Reuters Berita 24 English - Despite French President Emmanuel Macron losing an absolute majority in the country's parliamentary...
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| Image: Reuters |
Berita 24 English - Despite French President Emmanuel Macron losing an absolute majority in the country's parliamentary election, the euro climbed on Monday, while the dollar fell against its main rivals after reaching a 20-year high last week.
Final results showed that Macron's centrist Ensemble coalition won the most members in the National Assembly but came far short of the absolute majority required to rule parliament.
The euro rose 0.2 percent against the dollar to $1.05155, as analysts and traders shrugged off the election results.
"A Macron presidency and majority in Parliament would be very great for euro zone collaboration and so on," said Ingvild Borgen Gjerde, FX analyst at DNB Markets. "However, it's more for the long term, it's not something that affects markets right now," he added.
"There are two factors that are critical for the euro: the ECB's ability to develop anti-fragmentation tools and the prognosis for monetary policy."
Last Monday, the European Central Bank said that it would develop a new anti-fragmentation instrument to help the EU's indebted southern rim.
After touching 135.44 yen in Asia-Pacific trading hours, the dollar fell 0.2 percent to 134.715 yen, close to Wednesday's high of 135.60, the highest since October 1998.
The dollar index, which compares the greenback to a basket of six currencies including the euro and the yen, fell 0.25 percent to 104.44, but it remained close to a two-decade high of 105.79 set on Wednesday last week, the day the Federal Reserve raised interest rates by 75 basis points in an attempt to cool rising inflation.
On Wednesday and Thursday this week, Fed Chair Jerome Powell will appear before the Senate and the House of Representatives.
According to Osamu Takashima, head of G10 FX strategy at Citigroup Global Markets Japan, the dollar's decline is being fueled by minimal trade as the US markets observe a public holiday on Monday.
The dollar fell 0.4 percent against the Swiss franc to 0.96525, while sterling rose 0.1 percent to $1.2232.
The Australian dollar increased by 0.6% to $0.6980.
However, the world's most popular cryptocurrency, bitcoin, fell 2% to $20,154, returning to the weekend's low of $17,592.78, a level not seen since late 2020.
