The Euro slid on Monday’s opening of the European trading session, reacting to the German State election results. German Chancellor Angela Merkel’s ruling centre-right coalition of Christian Democrats (CDU) lost votes in a regional stronghold in the state of Baden-Wuerttemberg. The result could weaken Merkel’s coalition government and its ability to pass legislation. As the Eurozone debt crisis weighs down on the Euro, the latest news from Europe’s strongest economy suffered another blow.
After closing the New York session on Friday at 1.4080, the EURUSD continued to slide in the Asian session and is currently trading the European session at 1.4055. The US Dollar’s strength against the Single Currency was boosted by Friday’s positive remarks by a Fed official who gave an indication that the US Central Bank will be tightening monetary policy in the near future to avert inflation.