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Forex Today: Euro hit by Italy hung parliament, UK services PMI eyed

The Euro witnessed a mixed start to the week, initially having received a boost following the weekend’s German SPD’s vote in favor of the coalition deal. However, the upside was short-lived as sentiment soured on the Italian election’s projected outcome of a hung parliament, with both the anti-establishment 5-Star Movement and the far-right League party outperforming in the first exit polls.

Meanwhile, the US dollar found some love against the Antipodeans, as downbeat Chinese Caixin services PMI weighed down on both the Aussie and Kiwi. The USD/JPY pair, however, traded with sizeable losses amid risk-off market profile, reflected by negative Asian equities and Treasury yields.

Among the commodities, gold prices remained well bid near $ 1330 levels while both crude benchmarks also traded higher amid the Libyan Sharara oilfield shutdown news and ahead of the OPEC meeting with the US shale firms.

Main topics in Asia

European Politics in focus start of week: Italian election / German coalition risks

Italy’s ruling centre-left Democratic Party admits defeat - The Guardian

Berlusconi's right-wing coalition leads Italy's election: RAI state television

China's Caixin services PMI eases in Feb, misses expectations

Trump trade advisor sees business exemptions to tariffs - Reuters

New Zealand Treasury - there is still some spare capacity in the labour market

China to cut import tariff on auto, some consumer goods: NDRC - Bloomberg

Key Focus ahead

The European calendar sees a busy start to a fresh week, with the final services PMI reports from the Euro area economies due on the cards ahead of the UK services PMI and Eurozone Sentix Investor Confidence. Meanwhile, the US docket offers a set of services PMI reports from Markit and ISM ahead of the FOMC member Quarles speech.

EUR/USD bearish bets lose value despite prospects of hung parliament in Italy

GBP/USD looks weaker than ever ahead of UK services PMI release

Key events for the week ahead - Nomura

RBA to be a non-event this week, or? - Westpac

Australia Jan retail trade to reverse most of the previous fall - ANZ

 

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