At the conclusion of the first round which decides the two candidates that contest the run-off, polls put the independent centrist Mr Macron ahead with 24 per cent of the vote and the anti-EU candidate Ms Le Pen on 22 per cent. Neither of France's major parties will be represented after Conservative Fran??ois Fillon took less than 20 per cent of the vote. Predictions for the run-off imply a 64-36 result in favour of Mr Macron in May.

The prospect of a victory by Ms Le Pen, the National Front leader, was viewed as likely to be negative for the euro because she has campaigned against European unification.

The single currency traded as high as $US1.092 on Monday before settling at $US1.084. Against the Australian dollar it is fetching $1.436, the highest since January, meaning one Australian dollar buys ???0.696.

With Mr Macron appearing secure in his lead and likely to form a successful coalition once in power, the political event risk looming over Europe is fading.

"There's actually a pretty good chance they end up with results that are quite positive for markets," said Stephen Halmarick, head of investment market research at Colonial First State Global Asset Management.

"Rather than this big swing to the right we're getting centre-left or centre-right traditional politicians."

Westpac economist Elliot Clarke said the French polling showed there was no groundswell of support for breaking away from the monetary union.

"There's not really a particularly strong desire amongst the population to leave Europe and so you get more support for an independent progressive candidate as opposed to stepping into an unknown and uncertain future."

However, Macron's independent platform showed "there is still that desire for something new" and an anti-EU message at Italy's elections next year could not be ruled out.

The biggest risk for Europe, Mr Clarke suggested, is that it is unable to sustain the momentum of growth without fiscal reform. "You don't have a lot of capacity to move forward on the fiscal front. In countries like Spain, that's led to growth and equally the German economy which is one of the most efficient and progressive, they've continued to see reasonable growth.

"In countries like France and Italy, you may not necessarily have the rise of anti-EU power but you don't have a conducive environment for fiscal reform either."

The International Monetary Fund raised its growth forecast for the euro area last week to 1.7 per cent in 2017 from a 1.6 per cent forecast in January.

The European Central Bank is still printing ???60 billion a month in monetary stimulus; Westpac expects that to decline to ???40 billion next year. "The reason why we have that expectation is we think at some point you're going to see growth in Europe disappoint," Mr Clarke said. Westpac also sees the euro falling against the dollar as the US raises interest rates this year, possibly to below parity by the end of 2018.

CFSGAM predicts the ECB will taper bond purchases to ???30 billion to ???40 billion a month beginning in December, and restore negative interest rates to zero by 2018.

Deutsche Bank economist Adam Boyton said: "as far as the market's concerned, the move higher in the euro today probably reflects some relief that the polls were reasonably accurate." The next move up or down for the euro would probably be determined by what happens to the US dollar, he said.

"Now that we've had the first round of the French election out of the way, the focus shifts to the US and how is the market viewing the Trump reflation trade." President Donald Trump has promised to unveil his tax plan April 26.