Euro readies for Greek challenge to troika

Today's Highlights

Euro readies for Greek challenge to troika

UK GDP in spotlight

FX Market Overview

I write this report in a word document and then copy and paste it into the report wizard in our system before it is published. I mention this because I missed the first line of yesterday's report which read "Happy Australia Day everyone." I know that is a limp excuse but I apologise for omitting it. I hope yours was a good one and Prince Philip getting a knighthood wasn't too traumatic for the republicans out there.

If you were celebrating Aussie day you may have missed all the excitement over the new Greek Prime Minister and the coalition he has formed between his own left leaning Syriza party and the right-leaning Independent Greeks party. They both harbour anti-European tendencies and they are on a collision course with the EU, EC and IMF as well as Germany over their demands to renegotiate the debts they owe to the troika. (Am I the only one who hears sleigh bells when that term is used?). So the euro remains weak even after marginal improvements in German business sentiment, as published by the IFO institute yesterday.

The lack of European data today; save for any news from Greece, means all eyes will be on the UK economic growth figures. It is forecast that GDP grew by 2.8% in the year to December; up from 2.6% in Q3. If that expectation is bettered by the actual figure, Sterling has room to press on and make more gains across the board. Clearly a disappointing figure will prompt some profit taking and Sterling may well get a tad cheaper in the short term.

The rest of today is given over to US data. Durable goods orders are a good measure of confidence as are the new home sales stats and the consumer confidence index itself. All are due today and all could be influential dependent on the data's relative position compared to the forecast stats. Traders are also awaiting tomorrow's US Federal Reserve interest rate announcement; due tomorrow evening. So perhaps trade will be muted in the interim.

And speaking of America, I hope all our readers along the Eastern Seaboard are warm and safe. It's amazing to see scnes of a deserted New York; looks like a post-apocalyptic movie.

In other news, a naked violinist in Oregon has filed a lawsuit against the police who he claims 'violated his rights' last year when they arrested him outside the federal courthouse in Portland whilst he was playing his violin in the nude. The $1.1 million lawsuit is for alleged wrongful arrest and unlawful imprisonment. I can't help wondering why a violinist didn't at least have a G string though.