More last-ditch weekend talks for Greece
Currencies Direct June 26th 2015 - 2 minute read
Despite the lack of progress on the debt negotiations between Greece and its creditors, investors remain optimistic – for now. Markets are taking a “wait and see” approach, and yesterday’s Eurogroup meeting finished without a deal (25 June). German Chancellor Angela Merkel vented her frustration with the lack of progress to reporters, which hints that a deal may actually be further away.
Greek Prime Minister Alexis Tsipras told reporters that, “European history is full of disagreements, negotiations and then compromise.” Even though he’s been given an ultimatum, he remained upbeat and hopeful that Greece and its creditors will find a compromise. Eurozone finance ministers will meet again on Saturday, 27 June for another day of talks.
Athens is now under increasing pressure to accept reform proposals put forward by its creditors. The proposals involve cutting pensions, raising VAT and holding back on taxing company profits. The talks this weekend are crucial (yes, yet again) because Greece has to make a €1.6 billion payment to the International Monetary Fund on Tuesday (30 June), and Mrs Merkel has expressed her wish to have a deal before the markets reopen on Monday. Luckily for Mrs Merkel, wishes are free.
A mixed bag for the US dollar
Over in the US, yesterday’s (25 June) data releases were mixed. May’s personal spending figures confirmed a recovery on that front in Q2. Initial jobless claims also came in slightly better, at 271,000. However, the flash Markit services Purchasing Managers’ Index fell to 54.8 – the lowest reading since January – and the Kansas City Federal Reserve’s manufacturing index remained very soft in the month of June.
The University of Michigan’s consumer sentiment report for June is due out this afternoon, providing further direction for the dollar.
Euro-watchers given plenty to think about today
The focus today will still be on any news with respect to Greece. As far as Europe’s economic data goes, today we’ll get consumer confidence numbers from France, consumer and business sentiment from Italy, and May’s Eurozone money and credit aggregates from the European Central Bank.
Have an excellent weekend.