We could discuss Greece every minute of the day for the next few weeks. One thing is for certain is that there will be volatility for the Euro. There will be news releases and ups and downs on a daily basis. To summarise, Greece have paid €6.8 Billion to the ECB, the Bank of Greece, and the IMF today. The Banks are open although with numerous restrictions and capital controls are still in place. Are they back to normal? Of course not. There are still queues, Greek citizens can now take out 420 Euro’s a week. Improvement? Not really. They were allowed to take out 60 Euro’s a day and if you do the maths it’s still 60 Euro’s a day, 7 days a week though they can now take out 420 Euro’s in one go. Yipee. There is a long way to go on this saga!
Higher or lower? Short-term, I think GBP/EUR goes slightly higher. Why? There is still some downside to go in this story before we have any positives. I would suggest looking at implementing orders around 1.44 the figure to take advantage of any moves on an intraday basis. Please contact myself or one of the trading team to discuss.
Cable has pushed slightly higher although it is struggling to have a sustained break to the upside. If you have a USD requirement I would look at covering off some of your exposure on a SPOT basis. If you can achieve around 1.55 I would suggest this is a good level, in the current market, to secure. Please contact myself or one of the team to discuss your individual requirements. Interest rate rises in the UK and US will start to become more prominent in the headlines from next month onwards. We have the BoE minutes out on Wednesday and it is expected to be re-iterated that a rate hike will be coming sooner rather than later. The UK and US economies have similar pressures to contend with at the moment in the jobs market and inflationary wise. I think rate hikes will be sooner rather than later, possibly in December. September will be a tad too soon I think.
We have a light week in terms of data. Not too much to report. I would expect a fairly range bound week on the majors unless we have any exceptional commentary that moves us out of current ranges.
If you have any questions please do let me know.
Have a great week.
Written by Liam Alexander