Euro Dips Amid French Vote Uncertainty and Sluggish Dollar

The euro weakened following initial projections from France's legislative elections indicating a hung parliament, raising concerns about the country's fiscal stability. The leftist New Popular Front (NFP) is expected to gain a significant number of seats in the National Assembly, posing a challenge to President Emmanuel Macron's centrist alliance and the far-right National Rally led by Marine Le Pen. This potential shift in power has heightened fears of increased government spending, which could exacerbate France's already strained financial situation.

Meanwhile, the dollar remained sluggish after soft U.S. payroll data, increasing expectations for the Federal Reserve to cut interest rates as early as September. The yen rose to a 3-1/2-week high against the dollar, recovering from a near 38-year low. In the cryptocurrency market, Bitcoin dropped about 2% to $55,188 amid speculation about the potential sale of tokens from the defunct Japanese exchange Mt. Gox. This broad mix of financial developments has contributed to heightened uncertainty in global markets.