Market Review - 26/05/2015 22:45GMT
Dollar rises broadly on renewed Greek debt concerns and upbeat U.S. data
The single currency fell again in Australia on Tuesday due to renewed market woes on Greek debt payment. Price easily penetrated Monday's 1.0959 low to 1.0885, however, short-covering lifted the pair to 1.0940 in New York morning before falling again to 1.0863 on upbeat US economic data.
Reuters reported earlier that Greece intends to make good on its debt obligations but needs aid urgently to be able to do so, the government said on Monday, after several senior officials insisted Athens had no money to pay a loan installment falling due next week.
Athens has the money to make monthly wage and pension payments this week, government spokesman Gabriel Sakellaridis told a news conference. But he was less direct when asked about the June 5 payment, reiterating the government's official stance that it has the responsibility to pay all its obligations.
Greek FinMin Varoufakis said on Tuesday there was no reason to believe Greece would be in default after a 300 million euro payment to the IMF falls due on Jun 5. Separately, euro zone officials said deputy FinMins would hold a teleconference on Thursday to follow up on days of negotiations between representatives of Greece and creditors the IMF, the ECB and the European Commission.
Greece must repay four loans totalling 1.6 bln euros to the IMF next month, starting with a 300 mln euro payment on Jun 5. If no deal is reached within EU/IMF for new loans to be disbursed to Athens, Greece is likely to default on the IMF loan repayment. This would start a process that could lead Greece out of the euro zone.
Although the greenback moved narrowly on Monday, U.S. dollar ratcheted higher in Asia on Tuesday and then jumped up at European open. The pair easily penetrated Mar's 122.03 high to a fresh near 8-year peak at 123.32 before retreating briefly to 122.84 but only to rise again near NY close.
In other news, Germany and France have agreed plans to strengthen cooperation among euro zone countries without changing existing EU treaties, in a potential setback for British Prime Minister David Cameron as he holds key meetings this week with both countries' leaders.
The British pound remained under pressure in Asia on Tuesday and resumed its recent losing streak. Cable dropped to 1.5384 in European morning and then a session low at 1.5355 in New York morning after the release of upbeat U.S. durable goods data before paring its losses to 1.5415.
Wednesday will see the release of BOJ's meeting minutes, Australia's Westpac leading index, Germany's GfK consumer sentiment, EU financial stability review, Bank of Canada's rate decision and rate statement, U.S. building permits.
Dollar rises broadly on renewed Greek debt concerns and upbeat U.S. data
The single currency fell again in Australia on Tuesday due to renewed market woes on Greek debt payment. Price easily penetrated Monday's 1.0959 low to 1.0885, however, short-covering lifted the pair to 1.0940 in New York morning before falling again to 1.0863 on upbeat US economic data.
Reuters reported earlier that Greece intends to make good on its debt obligations but needs aid urgently to be able to do so, the government said on Monday, after several senior officials insisted Athens had no money to pay a loan installment falling due next week.
Athens has the money to make monthly wage and pension payments this week, government spokesman Gabriel Sakellaridis told a news conference. But he was less direct when asked about the June 5 payment, reiterating the government's official stance that it has the responsibility to pay all its obligations.
Greek FinMin Varoufakis said on Tuesday there was no reason to believe Greece would be in default after a 300 million euro payment to the IMF falls due on Jun 5. Separately, euro zone officials said deputy FinMins would hold a teleconference on Thursday to follow up on days of negotiations between representatives of Greece and creditors the IMF, the ECB and the European Commission.
Greece must repay four loans totalling 1.6 bln euros to the IMF next month, starting with a 300 mln euro payment on Jun 5. If no deal is reached within EU/IMF for new loans to be disbursed to Athens, Greece is likely to default on the IMF loan repayment. This would start a process that could lead Greece out of the euro zone.
Although the greenback moved narrowly on Monday, U.S. dollar ratcheted higher in Asia on Tuesday and then jumped up at European open. The pair easily penetrated Mar's 122.03 high to a fresh near 8-year peak at 123.32 before retreating briefly to 122.84 but only to rise again near NY close.
In other news, Germany and France have agreed plans to strengthen cooperation among euro zone countries without changing existing EU treaties, in a potential setback for British Prime Minister David Cameron as he holds key meetings this week with both countries' leaders.
The British pound remained under pressure in Asia on Tuesday and resumed its recent losing streak. Cable dropped to 1.5384 in European morning and then a session low at 1.5355 in New York morning after the release of upbeat U.S. durable goods data before paring its losses to 1.5415.
Wednesday will see the release of BOJ's meeting minutes, Australia's Westpac leading index, Germany's GfK consumer sentiment, EU financial stability review, Bank of Canada's rate decision and rate statement, U.S. building permits.
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