The weekend's political events have played.....>

EURO: The weekend's political events have played out inline with expectations.

- Germany's SPD party voted in favour of forming a Grand Coalition with the

ruling CDU/CSU bloc, although the latest trade related rumblings out of the US

are seemingly overshadowing this positive development, after US President Trump

threatened to slap a tariff on the European auto space if the EU retaliates to

his recently announced steel/aluminium tariffs.

- Elsewhere, the exit polls from the Italian election have been released (these

haven't always been the most reliable indicator in the past). Rai's exit poll

for the lower house gave the following estimates: Centre-right 225-265 seats, 5

Star Movement 195-235 seats, Centre-left 115-155 seats (316 are needed for a

majority). The Euro initially rallied with the "as expected" results coming to

fruition, as EURUSD touched 1.2365, but we are off of best levels for the pair

as the hung parliament in Italy indicates a weak coalition and uncertainty, all

eyes are now on the official results.