The US Dollar has a volatile start of the week, though it is on the back foot early on Monday.
Talk of the town is the surprise gain of the left coalition in France.
The US Dollar index hovers around 105.00, testing a vital level of support.
The US Dollar (USD) whipsaws on Monday, with markets celebrating the outcome of the second round of elections in France. In a surprise move, the left-wing coalition New Popular Front of Jean-Luc Mélenchon won and claimed victory, while the current ruling French President Emmanuel Macron’s centrist Ensemble alliance came in second. This is a surprise blow to the far-right National Rally of Marine Le Pen, who had a landslide victory in the first election round last week. With no one holding an absolute majority and political agendas being very dispersed and barely having any common ground, a hung parliament or a minority government seems to be the only possible outcome for now. Still, the far-right movement appears to be halted.
On Monday, all eyes will be on the bond market and the spreads between France and Germany. On the US economic front, it is a very calm start to the week. US Federal Reserve (Fed) Chairman Jerome Powell is heading to Capitol Hill on Tuesday and Wednesday for its semi-annual testimony on the economic outlook and recent monetary policy actions before the Joint Economic Committee. That is just ahead of the US Consumer Price Index (CPI) data for June, which is scheduled for Thursday. y.
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