The euro rose slightly against the US dollar on Tuesday as political turmoil in France sent traders rushing to hedge against further price swings, with some market participants signaling the crisis may be coming to an end.
The South Korean won, for its part, was one of the currencies that moved the most, falling against the dollar to lows in more than two years, after South Korean President Yoon Suk Yeol declared martial law in an unannounced speech late at night on television.
However, the won recovered some of its losses on Tuesday, after Yoon said he was lifting the martial law he had imposed hours earlier. Yoon’s declaration of martial law was unanimously rejected by 190 lawmakers in Parliament, and his own party urged him to lift the decree.
The dollar, for its part, rose briefly after it was reported that job offers in the United States increased moderately in October, while layoffs decreased, despite the fact that Federal Reserve officials did not give definitive guidance on Tuesday on what what they plan to do at their monetary policy meeting later this month.
With political tension in South Korea partially easing, investors focused on one of the euro zone’s biggest issues: French politics.
Read: The peso starts December with losses
French Prime Minister Michel Barnier faces a no-confidence vote on Wednesday following fierce opposition from across the political spectrum to his budget, which contains painful tax rises and spending cuts aimed at cleaning up the country’s precarious finances.
The euro, which had been the G10’s weakest currency until November, started this month down 0.7% on Monday and rose 0.1% to $1.0507, as France’s government headed for collapse over budget stagnation.
The Korean currency fell to 1,443.40 won per dollar, the lowest level since October 2022, immediately after the declaration of martial law. It later fell 1% to 1,418.35 after Yoon lifted martial law.
The dollar fell against the yen to 149.55 yen, while the euro was flat against the Japanese unit at 157.12 yen. Traders are increasingly confident that Japan will raise interest rates this month.
Lee: They report that the president of South Korea will end martial law
Meanwhile, the US Dollar Index was little changed at 106.33. The losses were reduced after it was learned that job openings, an indicator of demand for labor, had increased by 372,000 positions to 7.744 million on the last day of October, according to the Department of Labor’s Bureau of Labor Statistics in its Job Offers and Labor Rotation Survey (JOLTS).
With information from Reuters
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