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European FX Open - EUR broadly firmer as French election stays the focus




The EUR starts the new week firmer across the board.

BBC News reports supporters of Marine Le Pen s anti-immigration National Rally (RN) cheered as she said the president s 'Macronist bloc has been all but wiped out'. RN was on course to win 33.2% of the vote, with a left-wing alliance behind on 28.1%, and the Macron alliance behind on 21%.

The EURO looks to be buoyed by the belief that Le Pen s far-right party will struggle to win an outright majority after the first round in French elections. Bbg reports NR would need 289 lawmakers to have an absolute majority in the 577-seat lower house. But the electoral calculus gets complicated in the runoff when parties can strategically withhold candidates in certain constituencies to give a boost to a centrist hopeful.

EUR/USD comeback high so far is 1.0761, as it bases for now at last week's 1.0666.

Elections will stay a focus as fresh polls in France and attention on Thursday's UK general election and Biden's participation in the US presidential race will stay in investors minds.

A busy session ahead, with the UK nationwide HPI for June comes at the top of the hour, while final manufacturing PMIs for June and German state CPIs will be a focus through the morning.

In the second half, the US ISM manufacturing for June leads, forecast at 49.1 vs 48.7 the month previous.

Overnight, we got the Japan Q2 Tankan report, with large manufacturing rising to 13 vs the 11 consensus and last and more perceived BOJ rate hike friendly data.

ECB's Nagel is a scheduled speaker, while the Bank's president Lagarde is due tonight in Sintra.

Also on the news front, Australian Treasurer Jim Chalmers said domestic inflation remains too high but its zigzagging path lower matches those of the US and Canada, as the country boosted its forecast for resource-export revenue by 3% for this fiscal year.

And, Iran s presidential vote will go to a runoff on July 5, reports Bbg. Reformist Masoud Pezeshkian was leading in the latest count, ahead of ex-nuclear negotiator Saeed Jalili. Turnout was at a record low.

Elsewhere, the US 10-year yield stands firm just south of 4.40%; oil is in consolidation mode on the Usd 85/brl handle and US stock futures are all small positive at the time of writing.

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