Euro Shrugs off Spanish Election Results

Points to consider with Spanish elections and the euro:

• Euro little changed after the PP wins elections in Spain.
• PP wins 137 seats in the Spanish parliament.
• Brexit remains the focus of near-term risk for Forex traders.

The EUR/USD Forex market was little changed after the ruling PP party won elections in the Spanish parliament. This result was a hangover from the United Kingdom’s decision to leave the Eurozone on Friday. The PP party won a majority of 137 of 350 seats in Spain’s parliament. This was an improvement from its last election where they won 123 in December.

They will join with the likeminded Ciudadanos party, which won 32 seats which gives them a ruling coalition after months of uncertainty. The left wing Podemos party won only 71 seats, the same number it got in December. It is now behind the far-left PSOE party which has 85 seats. This confounded pollsters that though the Eurosceptic party would come in second in Spain’s parliament.

Spanish Elections unable to Support the euro for Long

There was some initial excitement in the euro Forex market after the election result but the euro was not able to maintain any gains. The UK vote to leave the EU is at the forefront of Forex trader’s decisions for now and the foreseeable future. There is way too much uncertainty over how detrimental this decision to the Eurozone and the UK this vote will be. This referendum decision by the UK will not find any answers to Forex and global financial market uncertainty quickly. The central focal point for financial investors, for the near-term, at the very least, will remain the Brexit aftermath. Anything else is second.