The euro slipped from a six-month high against the dollar, as investors digested the implication of Emmanuel Macron's comfortable win against Marine Le Pen in the French presidential election.
Overnight, the common currency climbed to $1.1022, the highest level against the dollar since November last year, after exit polls by Ipsos and Sopra Steria for French state television and Le Monde newspaper said that Macron won the election by a comfortable 65.1% to Le Pen's 35.9%.
However, in early trading on Monday (8 May), the euro had retreated to $1.0961 as investors reflected on the task awaiting the centrist candidate.
"Forex markets are also shrugging off the result," said Neil Wilson, senior market analyst at ETX Capital.
"A lot hinges on the European Central Bank (ECB) as well as Macron. If the ECB changes its language it could deliver a significant boost to the single currency."
Kit Juckes, head of forex at Societe Generale and IBTimes UK columnist, added the euro faced two short term challenges following the results of the French elections.
"A period of choppy trading is likely for now, but we do still expect the euro/dollar rate to move higher in due course," he said.
While the momentum behind the euro rally quickly petered out, Naeem Aslam, chief analyst at Think Markets UK, indicated there could be more good news ahead for the currency.
"The upside for the euro is limited but in the longer term, we could see the price moving near the level of $1.12 to $1.14 as the ECB would have one less thing to worry about," he said.
"The nuclear explosion for the euro would have been if Le Pen would have win the election because then the euro would have lost all the confidence and we could have seen easy 10% downward move. Macron's victory represents more stable signals for the currency in the longer term – at least for now."
Across the Channel, meanwhile, the pound was 0.23% higher against the euro, trading at €1.1833, but was broadly flat against the dollar, fetching $1.2974.
The greenback was also largely unchanged against its Canadian and Australian counterparts, but slid 0.12% against the yen and was trading at ¥112.58. However, the US currency performed better against the Swiss franc, rising 0.26% to CHF0.9903.
Last week, official data showed the US economy added 211,000 jobs in April, surging past expectations for a 190,000 figure, while the unemployment rate fell to 4.4%, beating forecast for a 4.6% reading.
"The better than expected data validates the Federal Reserve's statement that recent weakness in some economic data would prove transitory," said FXTM chief market strategist Hussein Sayed.