Euro Place for Largest monthly Fall since mid-2019; yen shorts Increase

Euro Place for Largest monthly Fall since mid-2019; yen shorts Increase

LONDON (Reuters) - The euro languished under $1.18 on Monday since the possibility of tougher coronavirus curbs at France and Germany weighed the short term prognosis for the European market.

The euro dropped 0.2percent in London trading in $1.1774, nearing final week's four-and-a-half-month trough of $1.1762. On a monthly basis, it's down 2.3 percent, its largest fall since July 2019.

"In brief, the U.S. market is a lot more powerful and miles ahead from the immunization game in contrast to Europe's and Japan's, which translates to the Fed normalizing policy decades ahead of the ECB or the BoJ," said Marios Hadjikyriacos, a strategist at Bank XM.

The euro's woes have shrunk as Europe's faltering vaccination programme runs right into a tide of fresh ailments, even as placement information revealed traders stay heavily extended euros, a bearish indication for investors. and

"Much attention will stay in the virus situation in Europe and if lockdowns can slow growing case amounts and whether the slow rate of vaccinations could eventually reach exit rate," ING economists stated in a daily notice.

The dollar held firm against other monies as a small risk-off sentiment rippled through international markets, together with U.S. stock futures in adverse land in silent quarter-end rebalancing flows.

YEN SHORTS GROW

Against a basket of currencies, the dollar steadied in 92.810, only below a November 2020 high in 92.92 hit a week.

Weekly positioning data revealed the wide tendency of developing dollar bullishness stayed in drama.

Brief yen positions have risen lately with hedge funds creating their web short stakes to 33 percent of available interest, based on ING data.

Steadying stock markets provided some support for the yen, but falling bond yields and expectations of an international economic rally have stopped brief bets. The yen is one of the worst- performing currencies so far this year, down 6 percent decrease the dollar.

The Aussie was last down 0.3percent at $0.7621 on Monday along with also the New Zealand dollar had fell 0.3percent to $0.6978. Sterling slipped 0.2percent to $1.3767.

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