Euro fell in European trade on Monday against a basket of major rivals, sharpening losses for the second day against the dollar and plumbing five-month lows amid increasing political uncertainty in Germany, and following suggestions by US President-elect Donald Trump.

Trump has suggested imposing tariffs on all European goods imports, which would threaten a deeper trade war between the EU and the US.

The Price 

The EUR/USD pair fell 0.4% today to $1.0678, the lowest since June 27, with a session-high at $1.0728.

The euro closed down 0.8% on Friday against the dollar following Trump's landslide election win last week.

It also lost 1.1% overall last week against the dollar, the fifth weekly loss in six weeks on concerns about renewed trade tensions between the EU and America.

Political Uncertainty in Germany 

A severe case of uncertainty is permeating the German political landscape, after the governing coalition collapsed after three years in the Parliament, paving the way for early elections.  

Trade Tensions 

Euro is under pressure from US President-elect Donald Trump's vows to impose tariffs on European goods imports, in accordance with his "America First" policy.

This policy of tariffs will no doubt raise pressures on trans-Atlantic relations and could lead to more damaging confrontations.

European Rates

Recent inflation showed consumer prices in the eurozone rose more than expected in October.

Following the data, the odds of an ECB 0.25% interest rate cut in December plunged from 85% to 50%.

Yen fell in Asian trade on Monday against a basket of major rivals, moving in a negative zone against the dollar and resuming losses after a two-day hiatus. 

The decline comes after the Bank of Japan's October meeting minutes, which showed divisions between policymakers on the timing of the next interest rate hike, but they agreed that yen's movements in the forex market will play a role in deciding the timing. 

The Price 

The USD/JPY pair rose 0.65% today to 153.61 yen per dollar, with a session-low at 152.61.

The yen closed up 0.25% on Friday against the dollar, moving away from four-month lows at 154.71 yen.

Yen was boosted as well after Japanese authorities issued a series of warnings about the extreme weakness of the local currency.

The BOJ

The Bank of Japan's latest meeting minutes showed that some members are concerned about uncertainty following the US elections. 

At the October 30-31 meeting, the BOJ maintained interest rates unchanged but said that risks from the US economy have shrunk, showing that the conditions are ripe for another rate hike.

However, the doves at the BOJ advised a slower pace in normalizing monetary policies. 

One of the doves warned that rate hikes could cause disruptions in the markets and impede the long-terem goal of backing away from massive monetary stimulus. 

One member called for consideration of more interest rate hikes, as the Japanese economy no longer requires heavy monetary support.

The minutes also showed that yen's weakness in the forex market has become a headache once more, due to its impact on import prices, especially for fuel and raw material.

Japanese Rates 

A recent Reuters poll showed the majority of economists expect the Bank of Japan to refrain from hiking interest rates in December, with the timing of the hike likely pushed back to March 2025.

Bitcoin rose on Sunday and extended the gains for the sixth straight session, trading above $80,000 for the first time ever and about to mark the biggest weekly profit since February as new investments flood the market.

The world’s most valuable currency surged by over 15% since Donald Trump’s US election victory, with promises of more flexible crypto regulations. 

At the same time, short crypto bets registered losses surpassing $280 million, which is unusually high for weekend trading. 

The Price 

Bitcoin rose 4.5% at Bitstamp today to $80,115, a record high, with a session-low at $76,554. 

On Sunday, bitcoin edged up 0.25%, marking the fifth profit in a row.

Crypto Market Value 

The market value of cryptocurrencies rose by over $135 billion to a total of $2.872 trillion, the highest since March as both bitcoin and ethereum surged.

Weekly Trades 

Bitcoin is up 17% so far this week on track for the largest weekly profit since February.

Trump

Trump will become the 47th president of America, after beating his Democratic opponent in a landslide. 

Not only has Trump won the presidential election, his Republican party now controls both chambers of Congress.

Bitcoin has risen over 15% since Trump’s landslide victory with traders optimistic for the future of cryptocurrencies in the US.

Massive Short-Trade Losses 

Short trades on cryptocurrencies lost over $280 million, including $130 million worth of short trades on bitcoin, and $70 million for ethereum.

The liquidation of short crypto trades comes as traders fail to provide enough margins to counter the huge gains experienced by cryptocurrencies in the past few days. 

US stock indices rose on Friday amid spreading optimism in the markets following Donald Trump's stunning landslide election vote this week, with Wall Street marking record highs and stellar weekly gains. 

Analysts expect the new Trump presidency to boost economic growth through aggressive tax and regulation cuts. 

Earlier US data from the University of Michigan showed the cnsumer confidence index rose 3.5% m/m in November to 73 points, up from 70.5 in October. 

At the close, Dow Jones was up 0.6%, or 259 points at 43,989 points, with a weekly profit of 4.6%. 

S&P 500 rose 0.4%, or 22 points to 5995 points at the close, with a weekly profit of 4.6%.

NASDAQ added 0.1%, or 17 points to 19,286 points, with a weekly profit of 5.75%.