Talks between Greece and its private creditors will resume
today, after an agreement over the country’s debt restructuring failed to reach a conclusion over the weekend. Fear is growing that Athens has not given enough guarantees, that they can implement the more severe austerity measures needed to receive the next 14.5 billion bailout package and ultimately save the country from bankruptcy. Considering the deadline for Greece to pay its next instalment is mid-March, time is fast running out for the country and their involvement in the single currency, unless a deal can be struck imminently.
The hope had been that an agreement would be in place by
Sunday night and if this had been the case I feel we would of seen the Eurostrength many analysts have been predicting. As it stands investors are still waiting for developments in Europe to progress and we have seen Sterling spike this morning by 0.5% against the Euro, possibly due to the protraction of the debt talks in Greece.
What we do know is that the longer this situation continues
without a positive resolution, the more the markets will lose confidence in the single currency. However, with the real possibility of another round of Quantitative Easing being announced by the BOE (Bank Of England) this week and the on-going negative data being released in the UK, any resolution to the Greek debt talks could see some major Euro strength and move the currency pair back toward the 1.19 level and beyond.
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