Euro steady ahead of French election

The euro has been reasonably steady against the dollar over the past few days,  having jumped above $1.0.7 at the start of the week,  and fairly stable too against sterling after losing ground immediately following the surprise UK election announcement on Tuesday

There is scope for some volatility in the currency markets at the start of next week, given the first round of voting in the French presidential election takes place this Sunday. The latest polls show Macron extending his lead slightly over Le Pen but on the basis of their current ratings the two look set to contest the second round in May

US bond yields continued to nudge higher yesterday, reversing some more of the quite sharp fall that occurred earlier in the week, with 10-year yields now back at almost 2.25%. Likewise, German 10-year yields rose by around 5bps to close at 0.24%

It was a better day for stocks with the US indices gaining almost 1% and European equities ahead by just over 0.5%.

Data due today include flash PMIs for the Euro area and UK retail sales. The latter rebounded in February after falling for 3 consecutive months, but according to the consensus forecast are expected to have fallen again in March