© Reuters.  Euro slightly lower, dollar rebounds against yen© Reuters. Euro slightly lower, dollar rebounds against yen

Investing.com – The euro slipped lower against the dollar on Monday as fears over political instability in Germany weighed, while the dollar pushed higher against the Japanese yen.

EUR/USD was at 1.1770 by 09:12 AM ET (02:13 PM GMT), after touching an overnight low of 1.1723.

The euro remained on the back foot after German President Frank-Walter Steinmeier said the country faces an unprecedented situation following the collapse of talks aimed at forming a coalition government.

He urged political parties to reconsider forming a coalition in order to avoid new elections.

Against the yen, the euro was last at 132.20, after rebounding from the two-month trough of 131.29 hit overnight.

The euro pared back losses against the pound, but remained lower with EUR/GBP last at 0.8888.

Sterling found support following reports that Britain may make concessions to smooth Brexit negotiations.

The pound gained ground against the dollar, with GBP/USD adding on 0.2% to trade at 1.3240.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, rose 0.15% to 93.75, boosted by the weaker euro.

The greenback’s gains were held in check amid lingering doubts over whether Republicans can pass a historic tax overhaul.

President Donald Trump tweeted on Sunday that Senator Jeff Flake will oppose the Republican tax bill, but the senator’s office said he has not yet made up his mind.

Last week the House voted to pass a tax bill that would lower corporate taxes and cut individual taxes for most households in 2018, in a step towards the biggest U.S. tax code overhaul since the 1980s.

Senate lawmakers are expected to vote on their version of the bill after this week’s Thanksgiving holiday.

The dollar gained ground against the yen, with USD/JPY climbing 0.21% to 112.32, recovering from the lows of 111.89 hit earlier, the weakest level since October 16.

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