The euro was up more than 1% against the dollar on Monday after jumping to 5-month highs earlier as the results of the first round of voting in French presidential elections eased concerns about the future of the euro zone.
EUR/USD was at 1.0854 by 11.38 GMT after going as high as 1.0920 overnight, the most since November 11.
Centrist former economy minister Emmanuel Macron edged out Marine Le Pen, leader of the far-right National Front party, in Sundays first round vote, delivering a result that most investors were hoping for.
Macron took 23.8% of the vote ahead of Le Pen on 21.7% according to final voting figures from France’s Interior Ministry.
Polls, which were largely accurate in predicting the first round outcome, have indicated that Macron will comfortably beat Le Pen in the runoff vote on May 7, easing fears over the risk of a French exit from the currency union and the potential breakup of the euro zone.
The dollar was sharply higher against the safe haven yen, with USD/JPY advancing 0.99% to 110.17, after hitting an earlier high of 110.52.
The euro was also higher against the Japanese currency, with EUR/JPY surging 2.21% to 119.60 after earlier logging a one-month high of 119.94.
EUR/GBP was last up 1.16% to 0.8467.
The stronger euro weighed on the dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies.
The index was down 0.71% to 98.95, but steeper losses were held in check by the greenback’s gains against the yen.
Investors were also monitoring geopolitical developments, amid heightened tensions on the Korean peninsula.
North Korea said on Sunday it was prepared to sink a U.S. aircraft carrier conducting drills with Japanese destroyers near the Philippines in order to demonstrate its military might.
Markets were also eyeing events in Washington amid concerns over the prospect of a looming deadline to avoid a government shutdown and ongoing uncertainty over economic policy.
U.S. President Donald Trump said Friday that a “big announcement” was coming this Wednesday on overhauling the U.S. tax code. An administration official said on Saturday that the announcement will consist of “broad principles and priorities”.
