Greece deal likely as reform proposals submitted (video)
Currencies Direct June 23rd 2015 - 2 minute read
Greece seems to have finally made a substantial breakthrough in securing €7.2 billion in funding from the European Commission, the International Monetary Fund and the European Central Bank.
During an emergency meeting in Brussels, Greece submitted a reform proposal which brings it “within days” of securing a deal, according to Greece’s finance minister, Giorgios Stathakis. His announcement brings some relief after weeks of often bad-tempered negotiations with Eurozone ministers.
Though the reform plans are in their early stages (Greece is still unwilling to compromise on pension reforms), the Eurozone’s finance ministers have welcomed Greece’s move to try to balance its books. European stock markets have surged after the news, and EURUSD currently trades at 1.1341.
US dollar boosted by housing recovery
The Greenback has strengthened overnight after better-than-expected home sales numbers leapt to a five-and-a-half year high in the second quarter of 2015. With markets fairly optimistic that the housing recovery has begun in the US, it gives investors more hope that the Federal Reserve will increase interest rates later this year – though Fed Chair Janet Yellen told the markets that the Fed is still monitoring US economic growth for indications as to when an interest rate rise should happen.
Focus will turn to economic data expected later today (23 June) in the form of US durable goods data, the Richmond manufacturing Index, the house price index, the Social Security Red Book numbers, and crude and gas inventories. Attention will also be on a speech by Federal Open Market Committee member Jerome Powell, as he’ll throw some light on economic conditions.
Sterling dips against Greenback
Positive US data has pushed Sterling back against the US dollar. Currently GBPUSD trades just under the 1.58 level. UK household consumption is fairly strong, though markets will look to the Confederation of British Industry’s June Industrial Trends Orders (released today) for further direction for the pound.
Also on today’s economic calendar are German manufacturing and services Purchasing Managers’ Index data, and Italian industrial sales numbers.