Following the first round of elections in France the euro is unable to defend its gains. In the view of economists at Commerzbank, the fact that opponents of the EU are strong in France cannot be a good sign for the single currency.

The single currency is a very tempting target for tribalistic politicians

“The news which the result of the first round of the French Presidential elections contained was actually EUR-positive. It was the fact that Emmanuel Macron actually gained a significant lead over the right-wing, anti-Europe competitor. A fact that was by no means certain based on recent polls.”

“Of course, EUR-bulls should worry. The fact that opponents of the EU are strong in France cannot be a good sign for the single currency.”

“The single currency is a very tempting target for tribalistic politicians. And further political integration in Europe, which from the point of view of many FX market participants might ease the (actual or alleged) deficit of economic and fiscal policy coordination within the single currency area, would clearly be off the agenda under a right-wing French President.”