© Reuters. Euro 1.18 level falls below $hits 1-month lows
Investing.com — The euro extended losses against the dollar on Tuesday fell to a one-month low, as worries about Germany’s election results and jitters before the Catalan independence referendum weighed.
EUR/USD hits a low of 1.1718, the weakest level since may 25. August and was in the 1.1793 at 09:23 PM ET (13:23 GMT), from 0.45% for the day
The single currency remained on the back foot after German Chancellor Angela Merkel won weekend elections, but the large numbers of voters desert saw their party for the right.
Merkel is now in negotiations months ago, the coalition to try to form a stable government, investors leave worried that the political uncertainty could make it difficult to beat the German economy closer to the euro-zone integration.
The euro was also with a view on the political risk in Spain, with the Catalan government to hold a referendum it plans to hold, whether to break away from Spain on Sunday, despite the opposition of the Spanish authorities.
The mood on the euro was also hit, according to the President of the European Central Bank, Mario Draghi, said on Monday that «adequate» ECB-accommodation was still needed, and added that the currency volatility is a source of uncertainty that requires monitoring.
The euro hit 10-week lows against the pound, with EUR/GBP 0.31% fall to 0.8771.
The single currency was steady against the yen, with EUR/JPY at 132.28.
The US dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up to -0.4% at 92.81, boosted by the weaker euro.
Investors were looking to a speech by Fed chair Janet Yellen later in the trading day after the US Central Bank indicated last week that it is still on course for a third rate hike before the years end.
The dollar moved higher against the yen, with USD/JPY advancing 0.38% to 112.13.
The dollar slipped against the yen overnight amid fresh concerns over tensions on the Korean Peninsula.
North Korea’s foreign Minister said on Monday, the US President, Donald Trump had declared war on the country, and that Pyongyang reserved the right to shoot down US bombers.
The yen is often tried in times of geopolitical tensions or the market turmoil, because Japan has a large current account surplus and dealers, the repatriation of capital in times of crisis would tend to apply to Japanese investors.