Euro fell in European trade on Friday against a basket of major rivals, sharpening losses for the second day against the dollar and giving up $1.07, marking six-week lows and on track for the largest weekly loss since April amid mounting EU political risks.

Anti-EU parties won a quarter of seats at the European Parliament in the last elections, up from a fifth in 2019.

And after the governing French party lost the vote to the far right in European elections, French President Emanuel Macron dissolved the local parliament and called for an early election.

As the euro continues to face downward risks due to mounting political tensions, analysts expect more losses for the common currency.

The Price

The EUR/USD fell 0.5% today to $1.0680, the lowest since May 2, with a session-high at $1.0745.

The pair lost 0.7% on Thursday, resuming losses after a short hiatus.

Weekly Trades

The EUR/USD pair is down 1.1% so far this week, on track for the second weekly loss in a row, and the largest since early April.

EU Parliament Elections

After election results were revealed, the far right groups controlled nearly a quarter of the Brussel-based Parliament, up from a fifth in 2019.

Some analysts noted that even as centrist groups managed to maintain their majority, the new European Parliament is now the most right-wing it has been since its establishment.

Early French Elections

French President Emanuel Macron dissolved the parliament and called for early legislative elections after the results of the EU Parliament elections.

The governing French party lost the EU elections to the far right, forcing Macron to gamble with the new local elections to try and reassert authority.

Analysts note that the odds of a surprise win by the far right in French elections will keep the euro under pressure in the short term.

Grim Outlook for Euro

Singapore Banks analysts pointed to French political risks as the main reason behind euros performance as the worst performing major currency this week.

They expect the EUR/USD pair to fall once more below $1.07 in the near term.