- Greece has gotten off-track in terms of getting financing under control and must get back on track before new programme can begin
- Greece must reach common agreement regarding PSI
- Greece must reach agreement with Troika asap
- EZ remains firmly behind Greece’s continued memebership
- EFSF CEO Regling: Lending capacity and leveraging not affected by downgrades
- Chinese New Year holiday ensured another quiet session
- Regional stockmarkets fall back from early gains to finish flat
- Gold falls $5 to $1672/oz
EZ FinMins ended their meeting and headlines from Juncker and Regling were moderately upbeat, but cautious nonetheless. It was clear that the EZ wants and expects Greece to remain a member, but they have some serious housekeeping to take care of and they must reach compromises and agreements with the IIF and the Troika.
EUR/USD closed in New York near 1.3020 and has gradually slid lower in very quiet trade. Even the myriad of headlines after the EZ FinMIn meeting couldn’t waken it up. The market had anticipated stops below 1.2985 but it looks like they were non-existent as we got to that level and bounced.
AUD/USD slid lower through the session but only modest AUD/NZD selling flows have been reported. The market is quiet ahead of tomorrow’s CPI and of course during the Chinese New Year.
EUR/CHF is the other focus with the market on tenterhooks ahead of important support at 1.2050, vital support at 1.2000, and monster stops just below.
Ranges: EUR/USD 1.2985/1.3000; USD/JPY 76.92/77.04; EUR/JPY 100.00/38; EUR/CHF 1.2061/78; Cable 1.5535/80; AUD/USD 1.0480/1.0536.