Greece aid deal leaves markets in limbo (video)

In keeping with the broader theme for markets, the Greenback continues to be supported by investors on the assumption that the Federal Reserve will raise interest rates at some point this year. The US dollar clawed back some gains against the euro due to concern that Greece has not yet submitted a proposal outlining major reforms to Germany.
 
Germany’s finance minister has said that no proposals have been made, while the Greek government has pointed the finger back at Germany, brandishing the plans as being "too vague". Greece seeks to extend the monetary aid package to €240 billion by the 20 April.
 
Although market and investor sentiment has been dampened due to the Greece deal, stronger than expected German and Spanish CPI numbers, released yesterday, have kept euro losses in check. This also points towards better expectations for Eurozone inflation in the future as Mario Draghi’s quantitative easing program settles in. However, the threat of falling oil and energy prices still remains.
 

Economic data to look out for
 
German retail sales and unemployment numbers are out today from the Eurozone as well as French consumer spending as EUR/USD currently trades at 1.0775. From the US, data expected today comprises of Consumer confidence numbers ahead of Friday’s keenly watched non-farm payroll numbers with expectations that the US has added in excess of 250,000 jobs to the labour market.
 
The pound remained subdued in Monday’s trading session trading in a range against the Greenback between 1.48-1.49 as monetary policy stances between the US and the UK continue to widen. With inflation at record lows in the UK, the Bank of England will not be raising interest rates despite UK consumer confidence sitting at a 13-year high and increased spending expected over the Easter weekend.
 
Most of the movement for Sterling will come from data on the economic calendar which comprises of Q4 GDP numbers and the Current Account balance. Sharp rallies after the data prints is unlikely given that monetary policy is being heavily driven by Bank of England’s accommodative policy.

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