EUR/USD Buffeted on Latest French Presidential Moves
- EURUSD swings on mixed political and economic news.
- French political risk returns as Alain Juppe refuses to enter the Presidential race.
EURUSD swung between 1.6400 and 1.5950 in early morning trade in Europe on the back of mixed economic data and news that Alain Juppe would not put his name in the hat for the upcoming French Presidential election. The statement from Juppe will add to the pressure on the country’s right-wing candidate Francois Fillon – who defeated Juppe for the party’s candidacy – after French prosecutors said that they would launch a criminal investigation into allegations that Fillon made payments to family members.
The announcement from Juppe knocked EURUSD back below 1.0600 after the pair had traded above 1.06400 earlier, extending Friday’s bounce back.
Earlier in the day, mixed European data aided the single currency. The German Markit construction PMI (Feb) jumped to 54.1 from 52. According to Trevor Balchin, senior economist at IHS Markit, the acceleration in construction growth reflected expansion across the boardwith civil engineering posting one of the sharpest increases in activity in the survey history. “Moreover, the volume of new work rose at the second-fastest rate on record, underpinning a firmly positive outlook for the sector.”
The Euro-Zone Sentix investor confidence index for March also helped to underpin the EUR, coming in at the strongest level in nearly ten years. Investor confidence rose to 20.7 from 17.4 in February, and beat expectations of a rise to 18.5.
Euro-zone Markit retail sales for February however did not reflect this growing confidence and slipped to 49.9 from a 50.1. A reading below 50 represents a contraction in retail sales from the previous month.
Chart: EURUSD 5-Minute Timeframe (March 6, 2017).
--- Written by Nick Cawley, Analyst
To contact Nick, email him at Nicholas.firstname.lastname@example.org
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