Euro hits 3-week high ahead of French election before reterating on Paris shooting: April 21, 2017

Market Review - 20/04/2017  21:12GMT  

Euro hits 3-week high ahead of French election before reterating on Paris shooting

The single currency gained across the board on Thursday and hit 3-week high vs usd at 1.0778 in Europe as uncertainty surrounding the French election eased as recent polls showed Macron in the lead. However, price pared intra-day gains on news of fatal shootings in Paris.  
  
The Harris Interactive opinion poll showed that 25% of voters intended to vote for Macron in the run-up to Sunday's first round of voting, ahead of Marine Le Pen, leader of the far-right National Front party on 22%.  
  
Earlier in the day, the single currency traded with a firm bias in Asia and rallied to an intra-day high at 1.0778 in European morning as latest polls showed centrist candidate Emmanuel Macron will win the French presidential election. However, euro pared its gains and retreated to 1.0740 at New York open before rebounding again to 1.0777. However, price retreated and later fell back to 1.0715 after news of shootings in Paris.  
  
Reuters later reported one policeman was killed and two others wounded in a shooting incident in central Paris on Thursday night, police and the interior ministry said.  
  
The shooting, in which the assailant was also killed, took place on the Champs-Elysees shopping boulevard just days ahead of France's presidential election.   
  
A witness told Reuters that a man got out of a car at the scene and began shooting with a machine gun. A police source also said more shots had been fired at another location near the scene.  
  
A French interior ministry spokesman said it was too early to say what the motive of the attack was, but that it was clear the police officers had been deliberately targeted.  
  
Versus the Japanese yen, although dollar retreated from Asian high at 109.07 to session low at 108.72 in early European morning, price pared its losses and rose to 109.45 in New York morning due partly to active cross-selling of yen. Price later hit session highs of 109.48 before retreating on cross-buying in yen.  
  
The British pound also traded with a firm bias in Asia and rose in tandem with euro to 1.2844 in European morning. Despite a brief retreat to 1.2787 ahead of New York open on cross-selling of sterling vs euro, cable climbed in tandem with euro to session highs of 1.2847 in New York morning before easing.   
  
In other news, Fed's Kaplan said 'Fed is still accommodative but not as much as people think; action on balance sheet cud come as soon or late as this year, or early next; tapering of Fed balance sheet should be phased in n gradual; thinks appropriate to give action plan on reducing balance sheet 2 to 3 months b4 Fed begins.'  
  
On the data front, the number of individuals filing for initial jobless benefits in the week ending April 15 increased by 10,000 to a seasonally adjusted 244,000 from the previous week's total of 234,000, the U.S. Department of Labor said. Analysts expected jobless claims to rise by 8,000 to 242,000 last week.  
  
Data to be released on Friday:  
  
Japan manufacturing PMI, France manufacturing PMI, services PMI, Germany manufacturing PMI, services PMI, Italy industrial orders, EU manufacturing PMI, services PMI, current account, UK retail sales, Canada CPI, U.S. manufacturing PMI, services PMI, and home sales.