The European single currency, euro, on Tuesday, March 21, briefly leaped above $1.08 for the first time in six weeks.
The euro was up 0.5 percent to $1.0794 by 0926 GMT. That pushed the index used to measure the dollar’s broader strength below 100 .DXY for the first time since early February. The euro was also 0.7 percent higher against the yen.
After four days of trading focused chiefly on expectations for U.S. interest rates and the Trump administration’s attitude to trade and a stronger dollar, the euro’s gains also sent the dollar index to a six-week low.
A cautious line from Federal Reserve speakers since it raised rates last week has added to signs the Trump team will have to take its time in delivering a promised fiscal boost to the economy.
Added to that has been an easing of some of the perceived political risks to the euro from populists like Le Pen, who wants to take France out of the single currency, and speculation the European Central Bank will rein in its ultra-loose monetary policy later this year.
A snap opinion poll after Monday’s debate showed Macron, a former economy minister who has never run for public office before, was seen as the most convincing among the top five contenders for the French presidency.
“The euro has been helped by Macron’s performance definitely,” said Stephen Gallo, head of European FX strategy at Bank of Montreal in London.
“I still want to buy dollars but not here. I think there will be a push higher in euro dollar in the very short run, before we would look for levels to be selling.”
The pound, a target for investors this year due to nerves over the UK economy’s performance in the face of its planned departure from the European Union, also gained 0.3 percent after a sluggish start.
Inflation data on Tuesday is expected to show prices rising further in Britain after a 20 percent fall in the currency in the last year. That would add to headwinds for consumer spending but might also fuel expectations that the Bank of England may yet raise interest rates to support the currency.
“Inflation rates are set to rise further in the coming months, though the impact of this on the pound is ambiguous as the resulting real income squeeze crimps activity,” said RBC strategist Adam Cole.
The pound was roughly flat against the euro at 86.95 pence, Reuters reports.
