On the day of the Brexit vote the British pound traded through an 1800 point range against the US dollar and more than 15 big figures against the Euro.
That kind of volatility isn’t expected for the Euro in the wake of this weekend’s first round of the French presidential election. But that’s because markets still largely see Emmanuel Macron as the eventual winner and next President of the Republic.
Yet the chances of a surprise outcome have increased materially in recent weeks. And that means it’s not only Euro and forex traders who will be watching the results closely in Asian trade Monday but markets across the globe.
Macron and Le Pen are still the front runners
In no small measure, Euro is sitting quietly around 1.07 and the French/German 10 year bond spreads are in a little from their recent wides because in France – with its rolling polls and commitment by pollsters to age and income stratification as part of their process – the polls are viewed as less likely to provide the type of surprise that both Brexit and Donald Trump’s election as US president did in 2016.
Get Greg’s overnight wrap of all the moves and his outlook for the day and his daily look at the Australian dollar and where it’s headed.