Eyes on French politics as US$ drifts

London THE US dollar traded close to one-month highs on Thursday, as the lack of a clearer signal from the US Federal Reserve that it might raise interest rates next month countered surprise praise from the new Treasury Secretary for a strong currency.

It traded in tight ranges against the yen and the euro, moving back above US$1.05 against the single currency - this after a pledge of support for centrist candidate Emmanuel Macron from one rival soothed investor nerves about how France's presidential election might pan out.

The political nerves that have affected trade in the single currency were still in evidence, driving two-month implied volatility of the currency to the highest in a month as contracts took in the first round of the election in April.