The sticking point here could be Germany

It’s shaping up to be a quieter week on the economic data front, although there are a few key releases to watch out for this week. Meanwhile, commodities remain a key focal point for traders this week with oil trading close to this year’s lows while Greece will also be back in the headlines as it tries to wrap up a deal on its €86 billion bailout agreed in principal back in July.

While Greece has to some extent fallen back to the periphery of investors’ minds in recent weeks having, in theory, secured its third bailout of around €86 billion, talks are still ongoing on the details of what exactly the reforms will include and how the funds will be dispersed.

The small matter of IMF involvement remains up in the air with members of the board claiming that the country no longer qualifies for aid as its debt has become unsustainable. This seems a bizarre stance to take given its role in creating the unsustainable debt load but given the desire in Germany for the IMF to be a part of the third bailout, it could be the driving force between some form of debt restructuring.

Talks between Greece and its creditors have gone surprisingly smoothly in recent weeks which considering what both sides went through in the first half of the year may be hard to believe. Greece is due to pay €3.2 billion to the European Central Bank, who they rely on to avoid a complete collapse of the banking system, which may explain their eagerness to agree on a deal in good time. The crippling effects that negotiations this year have had on the Greek economy which led to capital controls being put in place may also be encouraging the Greeks not to take such a tough line with the country’s creditors.

Greece appears confident that a memorandum of understanding can be drawn up by tomorrow which will enable the government to vote on it on Thursday and finance ministers from the currency bloc to provide their backing on Friday. While the Greeks are always more positive of reaching a deal than anyone else, if this can be achieved it would certainly be a first given the many battles and 11th hour deals that have come in the past.

The sticking point here could be Germany, with officials here apparently demanding further reforms and continuing to take a tougher stance than their colleagues. Germany is at risk of isolating itself again if it digs in its heals on this with other hawkish members of the union apparently happen to soften their stance as a compromise to Greece, which has significantly done so itself. A bridging loan has apparently been discussed to tie Greece over for a few more weeks although this will probably just create further hostility in the country where people are already very angry with the terms of the deal, most notably on pensions and privatizations.

The sell-off in commodities driven by a whole host of factors has been a key talking point in the markets of late and oil now appears to be on the verge on falling below this year’s lows. Gold has already fallen to five and a half year lows in recent weeks and could face another tough week again, with $1,043.75 being the next big support level as the yellow metal closes in on the psychologically important $1,000 mark which hasn’t been breached since the start of October 2009.

Economic data is few and far between this week, particularly today with the eurozone sentix consumer confidence reading being the only notable release and even this is not generally regarded as an impact event. It is expected to rise to 20.2 from 18.5 last month, which would be the highest reading in eight years. We’ll also hear from a few members of the Federal Reserve and get their insight into Friday’s jobs report and the prospect of a September rate hike.