2017.04.2402:13:00UTC+00Dollar Likely to rise Modestly Against Em Asian Currencies Post 2nd Round of French Election, says Scotiabank

The dollar is expected to rise modestly versus the Emerging Market Asian currencies after the second round of the French election and ahead of June Federal Open Market Committee (FOMC) meeting. The Federal Reserve may start to talk up the odds of a June rate hike from 50.2 percent only as of April 21 if the United States Bureau of Labor Statistics (BLS) delivers robust April non-farm payroll data, due to be released on May 5.

Centrist Emmanuel Macron and far-right nationalist Marine Le Pen won the first round of the French presidential election, progressing to a runoff on May 7. Defeated right-wing candidate Francois Fillon urged voters to rally behind Macron in the second round, while a new Harris survey saw Macron winning the runoff by 64 percent to 36 percent.

"Our seasonality analysis concluded that the DXY Index typically advances in May followed by a retreatment in June. Kindly note a slight rise in the DXY Index last June was attributable to escalating flight-to-quality demand stemming from an unexpected Brexit victory on June 24 2016," Scotiabank commented in its latest research report.

Meanwhile, the developments in geopolitical tensions on the Korean Peninsula remains to be watched for. The United States President Donald Trump has scheduled telephone conversations with Japanese Prime Minister Shinzo Abe and Chinese President Xi Jinping on Monday morning, according to South China Morning Post.