As tipped a few minutes ago by Deutsche Bank’s Sebastien Galy, who was out saying the euro is likely to get a boost of 1-2% based on projections from early counting of ballots in France, the single currency climbed 1.4% higher to 1.0881 after projections from early counting show Emmanuel Macron and Marine Le Pen in the lead.
That’s was highest level since late March.
Now we’re at 1.0920, a five-month high.
“This is the perfect scenario the market was desperately looking for,” New York-based Galy said in emailed comments to Bloomberg.
“A two-stage recovery in risk is expected with a good bounce on Monday but some uncertainty remaining until May 7,” Evercore ISI’s Krishna Guha wrote, in a note just after the initial results on Sunday, adding that the result is good for risk assets and favorable for the euro and euro-zone banks.
“The worst case outcome of a run-off between Le Pen and far-left Melenchon has been avoided and no estimate has Le Pen so far ahead of Macron as to increase concerns about his ability to overhaul her in the run-off with the benefit of second choice votes from other mainstream candidates,” Guha continued. “Still, with a substantial score for Melenchon, whose far-left voters may stay at home in the second round, some modest risk of a Le Pen win in the run-off vote will remain.”
