EUR pairs remain close to weekly lows after recent political shenanigans
No love for the EUR at the moment as markets price higher risk premiums given the current political uncertainty in France.It's important to keep in mind that political risk premiums tend to overshoot, which means at some stage the moves will get overdone and participants will start looking for bargains (be it in the EUR, spreads or equities).However, with the snap election called for June 30 and July 7, it's tough looking for bargains right now.On a side note, looking at the reaction in European markets this week, these two might become good friends after all... This article was written by Arno V Venter at www.forexlive.com.
No love for the EUR at the moment as markets price higher risk premiums given the current political uncertainty in France.
It's important to keep in mind that political risk premiums tend to overshoot, which means at some stage the moves will get overdone and participants will start looking for bargains (be it in the EUR, spreads or equities).
However, with the snap election called for June 30 and July 7, it's tough looking for bargains right now.
On a side note, looking at the reaction in European markets this week, these two might become good friends after all... This article was written by Arno V Venter at www.forexlive.com.
