The euro fell from its highest value in 14 days against the world's reserve currency on Monday after bond yields in Italy rose and borrowing expenses in France climbed. Nicolas Sarkozy, incumbent president of France, lost the first round of his re-election bid Sunday against Francoise Hollande. Germany saw manufacturing drop the fastest in nearly three years, also pressuring the euro.
"If bond spreads continue to widen and stock markets come under more pressure, we could see the euro drop towards $1.3050 rather than head towards $1.3250 in the near term," currency strategy head Jeremy Stretch with CIBC World Markets told the news service.
The weekend agreement to strengthen the International Monetary Fund's anti-debt efforts reduced losses that the euro was set to endure.