Sterling hit a fresh 17-month high against the euro on Monday as street riots in France and elevated energy prices weighed on the single currency while recent strong economic data and fewer concerns about the UK fiscal trajectory propped up the British currency.
The euro fell and the spread between French OAT bonds and safe-haven German Bunds widened by a few basis points after France was rocked by some of its worst unrest in years, adding to concerns over political stability. At the same time, natural gas prices climbed to a four-year high.
