Euro falls towards 5-month lows on Italian concerns and U.S. bond yield rise
May 17, 2018 / Tommy Wilkes
The euro fell towards a five-month low on Thursday as investors fretted about the demands of populist parties likely to form Italy's next government and as a fresh rise in U.S. Treasury bond yields underpinned demand for the dollar. The euro has slumped six cents from more than $1.24 in the space of three weeks after a huge dollar rally. Investors are betting that U.S. interest rates will need to rise further to curb inflation while other central banks are postponing monetary tightening. That has forced investors who took big positions against the dollar anticipating it would fall in 2018 to rush to unwind and cover their positions, pushing the greenback even higher.