Euro Turns Lower on Concerns Over the Collapse of the German Coalition Talks
The euro reversed lower versus its American counterpart on Monday under downward pressure stemming from news that talks to form a new government in Germany had collapsed.
The single currency lost dropped nearly 0.4 percent against the U.S. dollar, sending the pair EURUSD down to as low as $1.17473 in the morning North American trading session. The currency was under pressure on the back of uncertainties regarding to who will govern the largest European economy as German Chancellor Angela Merkel failed to reach an agreement with two other political parties to form a new government.
The pro-business FDP (Free Democratic Party) was reported to pull out of the talks with lawmakers citing irreconcilable differences.
The collapse of the German coalition talks held over the weekend would mark the first time since World War II that a general election had not led to a new government. Merkel is consulting with the German president Frank-Walter Steinmeier on Monday to decide what to do next. New elections are likely to be called.
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