The dollar fell on Monday after Friday’s weak U.S. jobs report reinforced expectations of a Federal Reserve rate cut this month, while the yen fell sharply after Japanese Prime Minister Shigeru Ishiba announced his resignation over the weekend.
- In Europe, the euro showed little reaction to news that the French Parliament voted Monday to dismiss Prime Minister François Bayrou. Parliament brought down the government over its plans to control the growing national debt, plunging the euro zone’s second-largest economy into an even deeper political crisis.
- The common European currency rose 0.2% against the dollar during the day, trading at $1.1751. Analysts said the outcome of the vote was predictable.
- In Japan, Ishiba announced his resignation on Sunday, which could usher in a long period of political uncertainty in the world’s fourth-largest economy and most indebted industrialized country.
- This put pressure on the yen overall. The dollar rose 0.2% to 147.695 yen, after gaining as much as 0.8% during the day.
- However, market attention focused on the dollar after Friday’s nonfarm payrolls supported bets that the Federal Reserve will cut interest rates at its meeting this month.
- “The driving force behind the currency market continues to be the dollar and events in the United States,” said Marc Chandler, chief market strategist at Bannockburn Forex.
- The dollar index fell 0.4% to 97.51, after losing more than 0.5% on Friday.
- In other currency pairs, the yen depreciated against the euro, reaching its lowest level in over a year. The euro rose 0.4% to 173.40 yen.
- Meanwhile, the British pound rose 0.3% to $1.3545, after gaining more than 0.5% on Friday.
Source: Yahoo!finanzas
