The euro got a boost on Wednesday after news that the Italian 5-Star Movement and far-right League were reportedly close to a deal.
Italy Close to Forming a Government
The euro, which fell approximately 4.1 percent against the dollar over the last month, climbed to $1.16 after reports that the 5-Star Movement and the far-right League were close to a deal to form a coalition government.
Close to a Deal
After 3 months of political deadlock, which saw the euro plunge over political instability in the European Union following the inconclusive March 4 elections the parties are reportedly close to a deal, to form a new government.
Political Risk in Spain
Investors remain wary on the political risks as Spanish, Prime Minister Mariano Rajo faces a vote of no confidence after certain members of his party face corruption charges on Friday.
Pedro Sanchez, socialist leader has pushed for a no-confidence vote against the Spanish Prime Minister after the Gurtel case, a corruption trial found people associated with Rajoy guilty of illegal kickbacks.
The Centre right People’s Party (PP) has been the ruling party for six years, the scheduled no-confidence vote on Friday could see the collapse of the government.
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Consider the news report today as:
U.S.-china Trade War Hots Up
The U.S. – China trade war hottened up after the announcement from U.S. Donald Trump that he would be imposing a $50 billion tariff on Chinese imports.
Also, U.S. tariffs on EU exemptions are coming up for expiry this coming Friday.
Against the yen, the euro rose 0.51 percent to 126.19.
The USD/JPY was at 108.72, the dollar fell against the yen.
Pound sterling gained against the dollar, up 0.28 percent at 1.3287.
Against the Swiss franc the euro gained 0.54 percent to 1.1500.
The U.S. Dollar index which measures a basket of six major currencies fell 0.38 percent to 94.45.