EUR/USD: notices from Tokyo about French election

EUR/USD touched 1.776 just yesterday, its highest level in this months, near the next technical level of 1.0814, but volatility is increasing with the waiting of investors for presidential election in France, next weekend.

Security will be a great focus in the run up to Sunday’s vote, after last attack in Paris claimed by Isis last night and this tension could favor the right of Marine Le Pen, who substain the exit of France out of European Union.

Masafumi Yamamoto, chief currency strategist for Mizuho Securities in Tokyo, affirmed that French elections will have “limited action” on the Euro and its exchanges, but an unexpected result in favor of Le Pen could generate shocks in the moment of market re-opening next Monday.

“If Le Pen were to get past the first round with a wide lead, the (market) impact could be large,” Yamamoto said.

Investors may be warried for the risk of an effect similar to Brexit news.

“I think the consensus is that France in the end will choose some one other than Le Pen, somebody more moderate,” said Masashi Murata, currency strategist for Brown Brothers Harriman in Tokyo.

Source: Reuters.com

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