Euro Weakens on Political Concerns, as Dollar Falls Against Yen

The euro dropped to a one-week low versus the U.S. dollar on uncertainty regarding French politics prior to the presidential vote along with other upcoming elections in Europe. Investors eyed French politics, with far-right National Front leader Marine Le Pen launching her presidential bid, pledging to combat globalisation and withdraw France out of the eurozone.

In late trading, the euro weakened by 0.4 percent versus the US dollar to $1.0742. It fell to $1.0705, its weakest level since Jan. 31. The greenback fell to two-month lows versus the Japanese yen amid a decline in U.S. Treasury yields. The spread between U.S. two-year and Japanese two-year debt yields shrank to nearly 136 basis points, the narrowest in two months. The greenback last fell 0.7 percent at 111.81 yen, and had previously weakened to 111.63, its lowest since late November.

According to analysts, strong equity markets and upbeat U.S. economic data have supported the previous year's bullish U.S. dollar demands. However, the lack of clarity on expected pro-dollar-tax-and-spending-initiatives by the administration of U.S. President Donald Trump as well as concerns on the outlook of the dollar and global trade have weighed on the currency.

News are provided by InstaForex