Greek Repayment Woes
The Pound has maintained it’s strength against the Euro during the UK public holiday yesterday to push slightly higher than the peaks reached at the close of last week. Against the US Dollar, however, the Pound has continued to cede ground this morning in an extension of the trends we have seen since the 18th May.
The Greek credit repayment issue continues with the Greek Interior Minister explaining that Greece has no money to pay the EUR1.6bn instalments for June. This sentiment has damaged the tone of Finance Minister Varoufakis who has been keen to point out that the Greek negotiations have been progressing in earnest and that considerable ground has been covered. The revealing comments about the inability of Greece to repay their monthly instalments have wiped a great deal of value from the ATG stock index, which lost 3.11% in Monday’s trading.
Focus on the UK/EU referendum has gathered pace with Prime Minister, David Cameron, pressing Britain’s interests in Europe. Having met with the European Commission president yesterday with an agenda to observe that the UK is unhappy with their current deal under the arrangement, Cameron is then on to France, Germany and Denmark (among others) to talk with their leaders as well. The date of the referendum is still not in place, but is expected to be announced on Thursday.
The Federal Reserve Governor, Janet Yellen, has been very clear in spelling out that while the US economy continues to strengthen and should lead to an interest rate rise during the course of this year, this would not be part of a pre-set course. Yellen is very clear in articulating that this would not be a plan to return considerable levels of interest and have pre-determined rate increases in mind, instead seeking to evaluate the economy as the first move has been made and the effects more clearly analysed.
Today in economic news, the overwhelming contributor is US data. We have durable goods orders, the housing price index, service PMI, consumer confidence and more. This could represent an opportunity to see further evidence of growth from the States and potentially add fuel to the interest rate conversation previously discussed.