Euro Drops As Italian Budget Deadline Nears
12 November 2018 - 6:56PM
RTTF2
The euro declined against its major counterparts in the European
session on Monday, as investors continued to fret over budget
stalemate between Italy and European Union as the deadline to
present a revised budget plan by the Italian government neared.
Italian Deputy Premier Matteo Salvini said Sunday that the
government could block European Union budget decisions and other
policies if the bloc's partners continue to show disrespect to
Italians.
The EU has asked Italy to come up with a revised budget plan by
Tuesday.
European Central Bank Vice President Luis de Guindos cautioned
that Italy's budget crisis poses concerns about public finances
given high debt level and the political tensions around the Italian
government's budget plans.
In economic news, latest projection from the Bank of France
showed that the French economy likely retained its growth momentum
in the fourth quarter.
Gross domestic product is set to grow 0.4 percent in the fourth
quarter of this year, the Bank of France projected in its latest
monthly business survey report. This is the first estimate by the
bank.
The currency has been trading lower against its major rivals in
the Asian session, barring the pound.
The euro dropped to near a 3-week low of 1.4847 against the
loonie, from a high of 1.4959 touched at 5:15 pm ET. The euro is
poised to find support around the 1.47 level.
The single currency weakened to 1.1240 against the greenback, a
level unseen since June 2017. The euro is likely to challenge
support around the 1.11 level.
Having advanced to a weekly high of 0.8774 against the pound at
1:30 am ET, the euro reversed direction and retreated to 0.8741.
The euro is seen finding support around the 0.86 mark.
The common currency declined to near a 3-week low of 1.1352
against the franc and near a 2-week low of 128.13 against the yen,
off its early highs of 1.1399 and 129.19, respectively. The next
possible support for the euro is seen around 1.12 against the franc
and 126.00 against the yen.
Pulling away from its early highs of 1.6833 against the kiwi and
1.5689 against the aussie, the euro dropped to near a 5-month low
of 1.6716 and near a 3-month low of 1.5622, respectively. If the
euro slides further, 1.66 and 1.55 are likely seen as its next
support levels against the kiwi and the aussie, respectively.
Looking ahead, at 2:30 pm ET, Federal Reserve Bank of San
Francisco President Mary Daly speaks about the economic outlook at
the Regional Economic Development for Eastern Idaho Conference.
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