The euro was down on Tuesday as investors nervous about trade tensions bought into the safe-haven dollar. Political risks in Europe remain high, even though pro-EU parties won a majority of European parliamentary seats.
Remarks by two-euro zone officials that the European Commission was likely to fine Italy also weighed on the single currency. Pro-Europe parties kept a majority of seats in last week’s European parliamentary elections. Support grew for eurosceptic and right-wing parties, but not as much as investors had feared. European leaders now meet in Brussels to fill in several top EU posts.
Currency markets remain in tight ranges without new catalysts and amid uncertainty over how trade tensions are affecting the world’s major economies.
As investors worried the U.S.-China trade feud was fast turning into a technology-focused cold war, the latest evidence of its impact on growth came from Germany.
The euro slipped 0.1% to $1.1179. The single currency’s initial gains after the EU election results were fleeting.
START TRADINGForex – Euro down as trade tensions boost dollar
The dollar rose 0.2% against a basket of peers, its index touching 97.791. It remains off a two-year high of 98.371 hit on Thursday.
The yen rose 0.3% to 109.26 yen. U.S. President Trump is expected to put pressure on Tokyo to reduce the nation’s large trade surplus with the United States.
The Australian dollar gained to $0.6923, about 0.75% above Thursday’s four-month low.
Sterling was down as candidates to succeed British Prime Minister Theresa May laid out some of their Brexit plans. The pound languished just off four-month lows on Tuesday, with risks of a no-deal Brexit seen rising. The British currency slipped 0.13% to $1.2657, having traded as low as $1.2605 last week. It was down 0.2% versus the euro at 88.405 pence to stand just off four-month lows.
Oil were mixed on Tuesday as prices were caught between concerns over global supply and fears that the U.S.-Chinese trade conflict will hurt demand. Brent crude fell by 9 cents, or 0.1%, to $70.02 a barrel by 1245 GMT, with prices repeatedly veering above and below $70 in choppy trading. U.S. West Texas Intermediate (WTI) was up 47 cents, or 0.8%, at $59.10. U.S. crude futures were trading for the firsttime since Friday after a long holiday weekend.
PLEASE NOTE The information above is not investment advice.
Sources: Reuters, Investing, CNN money