Euro at 6-month highs, Trump concerns hit dollar

The euro rose to the highest levels since November on Tuesday, while the dollar was broadly lower amid fresh concerns over the Trump administration following reports the U.S. president revealed classified information to Russia last week.

EUR/USD was up 0.63% to 1.1043 by 09.38 GMT, the strongest level since November 9.

Demand for the euro has been underpinned as investors shifted their attention back to the outlook for monetary policy as concerns over political risks receded after centrist Emmanuel Macron was elected France’s president over far-right nationalist Marine Le Pen last week.

Data on Tuesday confirmed that the euro area economy grew by 0.5% in the first quarter, fueling speculation over how soon the European Central Bank could scale back its stimulus program.

Another report showed that Germany economic sentiment continued to improve in May, hitting its highest since July 2015.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.37% at 98.45.

The dollar was hit following reports that U.S. President Donald Trump shared sensitive intelligence obtained from a close U.S. ally with Russia’s foreign minister about an Islamic State operation in a meeting last week.

The report came as Trump’s administration reels over his decision to sack former FBI Director James Comey and amid congressional calls for an independent investigation of possible Russian interference with the U.S. election.

The report added to doubts that Trump will be unable to successfully push through his economic stimulus program.

Against the safe haven yen, the dollar was lower, with USD/JPY sliding 0.2% to 113.54.

The pound dipped against the dollar, with GBP/USD edging down to 1.2886.

Sterling initially touched session highs of 1.2957 after data showing that UK inflation rose to its highest since September 2013 last month, underlining concerns over a squeeze on consumer spending.

The pound was pressured lower by weakness against the firmer euro, with EUR/GBP rising 0.73% to a one-month high of 0.8574.

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