Euro remains directionless vs usd on continued deadlock over Greek deal
The single currency went through another minor roller-coaster session on Thursday due to the renewed deadlock over Greek debt crisis. Despite euro's brief bounce from 1.1183 to 1.1228 in European morning, the pair nose-dived to 1.1154 before rebounding strongly to 1.1224. Euro then moved sideways in New York session.
EU's Moscovici said 'VAT, pensions remain sticking points in discussions with Greece; still discussing how to reach Greece's fiscal targets.' IMF's Lagarde said 'continues to work on a deal with Greece; creditor institutions are united.' EU's Dijsselbloem said 'door is still open for Greeks to accept creditors proposals; Eurogroup is over for now, he will inform EU leaders of state of talks.' IMF spokesman said 'on same page with ECB n EU Commission on Greece, have presented common position; must see Greece's reforms agreed and implemented, then will discuss financing financing n debt sustainability; does not extend deadlines as a matter of policy.'
An EU official said EU leaders discussed Greece's debt crisis with Prime Minister Alexis Tsipras for some two hours on Thursday in an unscheduled addition to their regular summit but insisted that negotiations be run by finance ministers. "There was an exchange of views on the way forward, not a negotiation," the official said, adding that leaders voiced hope that a planned meeting of finance ministers on Saturday could reach a deal to avert a Greek default next week. There was no plan for leaders of the 19 states that share the currency to meet separately on the sidelines of the EU summit on Thursday or Friday, the official said. He declined comment when asked if there could be a special euro summit on Sunday.
The greenback met renewed selling at 123.96 in Asia on Thursday and then weakened to 123.56 before recovering briefly to 123.80 in European morning but only to fall to 123.32. Dollar then rebounded to 123.76 in New York morning before trading sideways later in the day.
In other news, SNB's Jordan said 'franc considerably overvalued; ready to intervene in markets; outlook for global economy still be set with risks; doesn't currently expect deflationary spiral in Switzerland.' Swiss franc fell broadly after his comments.
Despite cable's brief drop to 1.5777 just before European open on Thursday, short-covering above Wednesday's low at 1.5667 lifted the pair to 1.5725 but euro-led weakness knocked price lower to 1.5680/81 before rallying to 1.5770 in NY morning. The pair then retreated to 1.5718 before trading sideways.
British Prime Minister David Cameron's desired changes to the European Union's treaties are likely to take a long time, Germany's Europe minister said on Thursday. Cameron has promised to renegotiate Britain's relationship with the 28-member bloc ahead of a membership referendum by the end of 2017. He has said treaty change will be needed in order to achieve the reforms Britain is seeking.
Friday will see the release of New Zealand's exports, imports and trade balance, Japan's all household spending, CPI and unemployment rate.
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