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Forex - Yen continues slide, euro steady near 5-month highs

Published 26/04/2017, 08:33
Updated 26/04/2017, 08:39
© Reuters.  Yen continues slide, euro steady near 5-month highs

© Reuters. Yen continues slide, euro steady near 5-month highs

Investing.com - The safe haven yen weakened again on Wednesday as a mood of renewed optimism buoyed market sentiment, and the euro remained steady near five-and-a-half month peaks as political risk in France receded.

USD/JPY was up 0.32% at 111.45, building on Tuesday’s strong gains when it climbed 1.2%, the largest one day gain in three months.

The dollar was boosted ahead of an expected tax reform announcement later in the day from U.S. President Donald Trump’s administration.

Market expectations were boosted by reports that the tax reform proposals would include cutting the corporate tax rate and lower taxes on offshore earnings of U.S. companies overseas.

The threat of a U.S. government shutdown this weekend also receded after Trump indicated that he is flexible about waiting to secure funding for his promised border wall with Mexico, in a shift that could clear the way for lawmakers to reach a deal.

Traders were also continuing to digest centrist candidate Emmanuel Macron's victory in the first round of France's presidential election on Sunday.

EUR/USD dipped 0.09% to 1.0923 after hitting a five-and-a-half month peak of 1.0949 on Tuesday.

Against the yen, the euro pushed higher, with EUR/JPY adding 0.23% to trade at 121.7. The euro has risen 4% against the Japanese currency so far this week.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, edged up 0.09% to 98.81. The index touched a low of 98.56 on Tuesday, the weakest since November 10, pressured lower by the stronger euro.

Sterling was lower against the dollar, with GBP/USD slipping 0.17% to 1.2819.

The Canadian dollar remained under pressure after slumping to a 14-month low on Tuesday amid concerns over an escalating trade dispute with the U.S.

USD/CAD inched up to 1.3581, after climbing as high as 1.3625 on Tuesday, the most since February 2016.

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