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Posted February 13th, 2015 by Charles Purdy

Eurozone troubles still centre on Greece

 The euro on Thursday remained under pressure. Over the course of the week it has held its own against sterling, although it did hit a seven year low at one point, and it has gained ground against the US dollar but is still close to eleven year lows.

Yesterday the German Consumer Price Index came out exactly as forecast, and year-on-year industrial production was worse than expected, at a negative 0.2%.

Greece is seemingly no closer to reaching a debt deal with its creditors as Wednesdays meeting of Eurozone Finance Ministers passed without progress.  On Monday we have the next meeting in what is a painfully tense process which could result in the breakup of the euro zone.  This situation is likely to dominate the Eurozone agenda for the next few weeks as politicians fight tooth and nail for the best for their side.

If you are looking to buy or sell euros, we suggest contacting your trader now for live rates, news and currency-purchasing strategies.

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Posted February 12th, 2015 by Charles Purdy

Euro struggling to hold its own

The euro had a difficult day on Wednesday. A particular focus for the single currency is the search for a deal with Greece on its debts and knowing how soon it will be reached. The struggles of the euro have been a great indicator for market confidence across Europe. At the start of this year the euro was close to €1.29/£1. In the space of six weeks it has weakened by nearly 5% against sterling evidencing how badly the euro is faring and how uncertainty over Greece has undermined it. Yesterday’s meeting of European Finance Ministers was inconclusive (at best) and another meeting is scheduled for Monday.

Posted February 11th, 2015 by Charles Purdy

European Ministers discuss Greece today, will it go well?

Tuesday was a fairly quiet day for the euro, besides a brief spike around lunch time when sources claimed the European Union (EU) could allow an extension to the Greek bailout. The euro has been significantly affected by the indecision around Greece’s future in the EU, and we expect rates to continue to fluctuate until a negotiation is finalised.

European officials are set to hold further meetings on the subject today and tomorrow; should there be talk or rumours of Greece remaining in the Eurozone then we should see the single currency benefit, but should negotiations begin to slow or become stagnant, which given the nature of politicians and all the vested interests involved is the more likely, this will be a positive for safer haven assets.

Posted February 10th, 2015 by Charles Purdy

Greek uncertainty makes it difficult for the euro

The euro had a difficult start to the week, as a lack of progress on the Greek bailout terms increased pressure on the single currency. We expect further tough conditions for the euro as the situation in Greece continues to affect market confidence. The country remains in the Eurozone for now, but potentially not for not much longer. Despite this, any positive announcements on Greece could also see the euro strengthen – we expect a fairly volatile market over the coming days.

Looking to today, we have the wholesale price index from Germany, and Italian industrial production figures – which are forecast to improve from -1.8% to -0.8%.

Posted February 9th, 2015 by Charles Purdy

Euro still very much in the hands of the Greeks

It was a mixed week for the euro, with Friday being a particularly bad day for the euro. Greece’s debt issues still remain key and was the major talking point across the last week. The euro in the short term will be a good gauge of the overall sentiment on the Greek economy and how well Greece can re-negotiate their bailout package. Uncertainty coupled with brinkmanship will occupy most of February.

For the week ahead it will be a big day on Thursday. The Consumer Price Index (CPI) data from Germany will be released which is forecast to worsen to -0.5% from December’s figure of 0.1%; any surprises could cause significant shifts in euro markets.

Posted February 6th, 2015 by Charles Purdy

No respite for Greece or the Euro

It had initially been a good week for the euro until Thursday. The Greek Finance Minister had been doing his rounds of other European Finance Ministers and everything sounded positive. He then met the European Central Bank (ECB) on Wednesday and his German counterpart on Thursday who gave him a very cold shoulder. The ECB then put the boot in making it very difficult if not impossible for Greek banks to borrow. Not nice but I am not sure what else the ECB and the Germans can do given the likelihood of other southern states coming with their begging bowls if they acquiesce.

Posted February 5th, 2015 by Charles Purdy

Euro weakens against sterling as ECB plays hardball

After a good day the euro fell sharply against sterling as the European Central Bank (ECB) announced that they would stop accepting Greek government debt as collateral from Greek banks as of the 11th February. As the ECB is their lender of last resort and the only lender willing to lend to the Greek banks at this moment it is clear that the ECB is playing hard ball with the Greeks and their attempts to renegotiate the agreed austerity measures. Against the US dollar though the euro just about held its own as data out of the US wasn’t as positive as hoped for.

Posted February 4th, 2015 by Charles Purdy

Euro bounces (a little)

Yesterday the euro gained across the board, particularly against sterling and the US dollar, the strongest we have seen in 10 days against sterling. The general outlook for the Eurozone is looking better as Greece’s new government is taking a softer approach in terms of negotiating its new bailout agreement, which has helped the fears of Greece leaving the bloc. There is always a twist, however, with the euro, as the Producer Price Index fell to -2.7%, down from last month’s figure of -1.6%.

Today we have the Purchasing Managers’ Index (PPI) and retail sales data released in the morning. PMI data is forecast to improve from last month figure but retail sales data are expected to decline to 0.2%, from 0.5%.

Posted February 3rd, 2015 by Charles Purdy

So far so good for the Greek Finance Minister

The euro had a mediocre start to the month. The Eurozone manufacturing Purchasing Managers’ Index (PMI) rose from 50.6 in December to 51.0 in January. Activity in France, Italy and Greece declined, while activity in Germany slowed from the previous month – this only means the concerns over the weak economy remain and aren’t likely to change anytime soon. Along with this release of data, the report also showed that producers cut prices at the fastest rate in the last 18 months, increasing worries around deflation in the Eurozone.

The Greek Finance Minister continues his grand tour of Eurozone Finance Ministers as he tries to get their buy in for the refinancing of Greek debt and the easing of the very strict austerity measures that have been imposed.

Posted February 2nd, 2015 by Charles Purdy

Greek brinkmanship – how will the euro react?

There was little movement for the euro on Friday as markets remained quiet throughout the week. Poor inflation figures from Europe had little impact, coming out at -0.6% in January. Unemployment for the Eurozone improved slightly, falling to 11.4% in December but remaining high in comparison to that of the UK and the USA. Inflation data was largely ignored as there is purported to be an improved long term outlook due to the European Central Bank (ECB)’s recent decision to roll out quantitative easing, which is due to begin in March.

There is a raft of data to be released for the Eurozone this week.

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