GBP buoyant versus EUR
Although GBP is indeed looking very positive against the Euro, breaking above 1.3930 at time of writing, the USD has fought its way back to the mid 1.48’s. Sterling has undoubtedly been depressed due to the impending election/political uncertainty, perhaps we would be comfortably above 1.4000 on GBP/EUR if the ruler of the land had already been decided.
Talk of a Greek debt default or Grexit, coupled with headlines that Greek state enterprises/local governments have been ordered to channel excess cash to the central bank will likely keep the EUR low.
If you are buying or selling Euro, key events in the Eurozone to watch out for in the next few days are:
- Apr 21 (today) German Apr ZEW business survey
- Apr 22 Eurozone flash Apr consumer confidence index
- Apr 23 Eurozone flash Apr PMI survey
- Apr 23 Euroworking Group press conference on Greece
- Apr 24 Eurogroup meeting on Greece in Riga
- Apr 24 Fitch to publish rating update on Cyprus, Italy and Spain
Elsewhere, the minutes of the April Reserve Bank of Australia meeting, where interest rates were kept unchanged, have been released. The Central Bank noted that it was appropriate to hold interest rates steady for the time being, while accepting that further easing of policy may be appropriate over the period ahead to foster sustainable growth in demand and inflation consistent with the target. In short, we could see further interest rate cuts from Australia in the coming months, equating to a weaker AUD.