EUR/USD: French markets stabilize after no confidence vote – Scotiabank

The Euro (EUR) is nudging a little higher following yesterday’s successful noconfidence motion in the French government. The motion brought an end to PM Barnier’s short tenure, Scotiabank’s Chief FX Strategist Shaun Osborne notes.

EUR nudges higher

“President Macron must now try and find another PM who can appeal to a broader swathe of parliament and get a budget approved. That’s no easy task. But, for now, local bonds have stabilized (outperforming OATs have closed the yield gap over 10Y Bunds by around 3bps today), helping give the EUR a modest boost.”

“Positive short-term price action yesterday and moderate gains through the low 1.05s today give the EUR a shot at extending a little higher to test key resistance and potential bull trigger at 1.0590. Support is 1.0465/70.”