Dollar shows strength; euro retreats ahead of French no-confidence vote
The US dollar rose Wednesday, while the euro retreated ahead of a vote of no-confidence in France later in the day that is likely to topple the fragile coalition government.
At 04:45 ET (09:45 GMT), the Dollar Index, which tracks the greenback against a basket of six other currencies, traded 0.1% higher to 106.465.
The dollar has been in demand Wednesday, boosted by its safe-haven status amid political turmoil in both South Korea and Europe as well as ongoing conflicts in the Middle East and Ukraine.
In Europe, EUR/USD dropped 0.1% to 1.0501, with the single currency struggling for support as the French political crisis comes to a head.
French lawmakers are preparing to vote on no-confidence motions later in the day that are all but certain to topple the government, with opposition parties seemingly unable to support Prime Minister Michel Barnier’s recent budget aimed at curbing a hefty budget deficit.
Additionally, data released earlier Wednesday showed that business activity across the eurozone fell sharply last month as the bloc's dominant services sector joined the manufacturing sector in contraction territory.
GBP/USD traded 0.1% higher to 1.2677, helped by UK activity data remaining in expansion territory.
USD/JPY climbed 0.7% to 150.68, while USD/CNY slipped 0.2% to 7.2730, with the Chinese currency bouncing from the previous day's low of 7.3145, the weakest since November of last year, helped by a stronger-than-expected central bank midpoint fixing.
AUD/USD slumped 1% to 0.6421, falling to its lowest level since early August after GDP data showed Australia’s economy grew less than expected in the third quarter, sparking increased bets that the Reserve Bank will cut interest rates early in 2025.
Source: Investing.com
