Crunch talks for Greece put pressure on euro (video)

EU leaders meet today (25 June) for a two-day summit in hopes of finally agreeing a deal for Greece. Those hopes were present at yesterday’s Eurogroup meeting, but evaporated quickly. The meeting was short but not sweet as the two sides failed to find the common ground needed. With the stakes very high for both sides, it’s still anticipated that an agreement of some sort will be reached.
 
This morning talks will continue ahead of the EU summit at yet another Eurogroup meeting. In the meantime, the European Central Bank continues to support Greece with liquidity to prevent a banking crisis. In the absence of a deal, the pressure on both the Greek banking system and the euro is likely to build.
 

US economy needs to work hard to make dollar look good
 
Today we have key feedback on the US economy; personal spending and income data, inflation data, and initial jobless claims. The personal spending and income should be positive and mirror the improvement in US retail sales for May.
 
PCE (personal consumption expenditure) inflation should also pick up slightly, and initial jobless claims ought to keep showing a healthy recovery for the labour market. If data surprises to the upside we could see a defined swing to US dollar strength, but it seems the market will only be tempted to buy the dollar on very strong feedback.

 
Pound reliant on Europe and the US for direction this week
 
The pound has been dancing to the tunes of the Greek saga and US data snaps. This is likely to continue for the rest of the week, because there’s no key UK data to affect the pound. The markets’ focus will be on Greece first, and US data second.  

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