He notes that French and German Business Confidence figures higher in November while broader Eurozone confidence surveys were essentially steady. Looking east, Chinese confidence surveys improved in November also helping market sentiment and gains in the Euro and Scandinavian currencies, NZD and AUD.
EU leaders are struggling to reach agreement on a new seven-year budget for the region, while new reports indicate that Eurozone finance ministers will hold a teleconference on Saturday ahead of their meeting on Monday, with the aim of speeding the process of finding a financing solution for Greece.
He writes, “While we wouldn’t want to understate the challenges of reaching agreement on Greece, news reports have described some of the remaining obstacles as technical and legal, and thus the hurdles to a deal do not seem insurmountable. Accordingly, an underlying expectation that Greece will receive further financing seems to be helping many G10 currencies, while the emerging currencies are mixed but stronger on balance, in particular the emerging European currencies. With the odds still favouring further financing for Greece soon, our bias remains for gains in most foreign currencies over the near-term.”