Euro hits 3-week high as Macron holds slim lead in presidential poll
The dollar continued to climb against the yen Thursday afternoon after Treasury Secretary Steven Mnuchin affirmed that there's bipartisan support for raising the U.S. debt ceiling, and that an extension would likely be approved by the summer.
The greenback advanced to Yen109.48 on his comments, compared with Yen108.86 late Wednesday in New York.
Investors have grown increasingly anxious since the U.S. reached the limits of its legal authority to borrow back in March, worrying that the same fractiousness that prevented President Donald Trump from passing his plan to repeal and replace Obamacare might also stymie a debt-ceiling accord, said Alfonso Esparza, senior currency analyst at Oanda.
"With a Republican president majority, it had seemed like a slam dunk," Esparza said. "Yet after the health-care reform fiasco, some questions began to emerge."
The dollar's advance moved the euro off a three-week high it had reached earlier in the session after the latest polling indicated that French centrist presidential candidate Emmanuel Macron remains the front running the France's tight presidential race. The first round of voting will take place on Sunday.
The shared currency bought $1.0719 in recent trade, down from an intraday high of $1.0779, the strongest level since March 28, according to FactSet data. That's up from $1.0712 late Wednesday in New York.
A Harris Interactive poll showed Macron with 25% support among respondents, slightly higher than the 22% for far-right National Front candidate Marine Le Pen, who has advocated for France to ditch the euro and leave the European Union.
Macron is running as an independent, but served as economy minister under Socialist President François Hollande.
Still, the French race remains extremely close. Far-left, euroskeptic Jean-Luc Melenchon has recently surged in the polls while conservative Francois Fillon's scandal-stricken campaign has seen a rebound in support.
Read:How to dazzle voters on the campaign trail? Upstart French candidate turns to holograms (http://www.marketwatch.com/story/how-to-dazzle-voters-on-the-campaign-trail-communist-backed-french-candidate-turns-to-holograms-2017-04-11)
"The best case scenario for the euro would be a Macron-Fillon run-off, while the worst case would see Le Pen and Melenchon fighting it out in the second round," said Joshua Mahony, market analyst at IG, in a note.
Read: Here's a sign euro traders are dangerously complacent about the French election (http://www.marketwatch.com/story/heres-a-sign-euro-traders-are-dangerously-complacent-about-the-french-election-2017-04-20)
Read: Here's how France's hotly contested election could spark market turmoil (http://www.marketwatch.com/story/heres-how-frances-hotly-contested-election-could-spark-market-turmoil-2017-04-19)
Meanwhile, the pound bought $1.2813, compared with $1.2779 late Wednesday.
The pound on Tuesday reclaimed the $1.28 handle for the first time since October after U.K. Prime Minister Theresa May unexpectedly called an early general election, which was approved by the British Parliament on Wednesday. The election will be held on June 8, moving it foward from 2020.
May said a snap election would give the government a clear mandate ahead of Brexit negotiations with the European Union.
Read:Why the snap U.K. election is a 'game changer' for the pound (http://www.marketwatch.com/story/heres-why-the-pound-surged-to-10-week-high-after-may-called-snap-uk-election-2017-04-18)
Also:Snap election 'virtually rules out' the U.K. staying in EU's single market (http://www.marketwatch.com/story/uk-snap-election-virtually-rules-out-staying-in-eus-single-market-says-morgan-stanley-2017-04-19)
Elsewhere, the Russian ruble strengthened against the dollar, reversing most of a sharp selloff from Wednesday's session that was triggered by oil's largest one-day loss in six weeks (http://www.marketwatch.com/story/oil-steadies-as-investors-await-eia-inventory-report-2017-04-19).
The currency, which is particularly sensitive to fluctuations in the price of oil, traded at 56.12 to the dollar, compared with 56.58 late Wednesday in New York.
(END) Dow Jones Newswires
April 20, 2017 15:07 ET (19:07 GMT)