Wednesday is crunch day for Greece as the all agreements in
the final proposal with the Eurozone creditors must be enacted today before the
Eurozone will move forward with partial funding to help Greece move forward.
The ECB is keeping the ELA frozen at 89 billion euros which has all been used
leaving no funds for the banks which remain closed until Thursday as the
government continues the banking holiday.
The euro has bounced around the 1.10 level since the agreement was
reached. Traders are watching the ECB closely as Mario Draghi might indicate
that the central bank will increase or extended their monetary stimulus program
to help the economy recover from the Greek stress. Draghi is also expected to
discuss funding for Greece on Thursday. Most analyst are expecting Draghi to
slowly increase the ELA to help fund the Greek banks. European shares trade mixed today as
investors await the outcome of tomorrow’s Greek vote in parliament. In the US,
Equities opened slightly higher, despite weaker than expected eco data.
The euro is trading at 1.1009 and against cable the euro is trading at 0.7061 down over 40 points as the pound climbed today after comments from the Bank of England Governor.
Governor Carney warned today in a testimony before lawmakers
that households should start to prepare for higher borrowing costs as the
economic recovery gathers momentum, though the central bank would raise rates
only slowly. BoE’s Miles added that the first rise in borrowing costs clearly
is coming and it was not a bad thing.
The US dollar eased a bit today on lackluster data ahead of
Janet Yellen’s testimony. The greenback is trading at 96.83. The dollar
declined after an unexpected fall in retail sales. Sretail sales slipped 0.3
percent last month, the weakest reading since February, as consumers cut back
on purchases of automobiles and other goods, according to a Commerce Department
report. Excluding automobiles, gasoline, building materials and food services,
core retail sales dipped 0.1 percent following a 0.7 percent gain in May. Economists polled by Reuters had forecast
retail sales rising 0.2 percent. Core retail sales had been expected to
increase 0.4 percent. Binary option
investors are expected to remain cautious ahead of scheduled testimony on
Wednesday and Thursday by Fed Chair Janet Yellen. Investors expect the Fed to
start raising rates later this year, in contrast to the European Central Bank
and the Bank of Japan, which are seen continuing with their ultra-loose
monetary policies for the foreseeable future.
The Daily Market Review brought to you by Billionaire Forex UK in collaboration with UKoptions, Investment House.
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