Euro continues to sell-off as the political crisis in Italy shows no signs of easing. Mattarella, the Italian President could dissolve parliament and Italy could be back to the polls late this coming July.
Volatility and concerns over the Italy were visible through Italian bond yields with 10-year benchmark government bonds go past the 3% mark from just below 2% prior to the recent political turmoil. The fear of another victory for euroskeptics will likely make it more difficult for Mattarella to ward off another eventual proposal based on euroskepticism itself.
Euro was softer across the board with the largest losses stemming from against the USD and JPY amongst the majors. EURUSD was down to lows of 1.1510 throughout Tuesday’s session, EURJPY is currently at 125.40 marking fresh 11-month lows.
On today’s economic docket we see German Unemployment and German CPI for May lined up. Later in the afternoon we are also expecting US Annualized GDP for Q1 and Canada is expected to pronounce itself on a rate decision – although so far consensus shows no changes on this front.
