The Pound made gains against the Euro while declining against the Dollar yesterday. “Analysts said sterling may be vulnerable to more weakness in the coming days and weeks as investors price in the prospect of further QE or even a 25 basis points rate cut” according to Reuters news agency.
The Dollar made gains against the Euro and the Pound, gaining from an increase in risk evasion. This risk sentiment remains vulnerable to not only the ECB but also to the tone of the Fed statement following the two day FOMC meeting which begins today.
The Euro declined against the Pound and the Dollar yesterday unwinding some of its recent gains, as the market fretted that the ECB may disappoint those hoping for strong actions from the European central bank to contain the Eurozone debt crisis. Euro downside was limited, though, with a reluctance to place large positions ahead of Thursday’s ECB meeting and, indeed, the euro has edged slightly higher overnight.
Evangelos Venizelos, leader of Greece’s PASOK party has admitted that the country’s bail-out programme is off track and urged parliament to seek talks with ECB and EU officials. He also reiterated calls for a two-year extension, until 2016, to implement Greece’s savage budget cuts. Spanish retail sales fell by 5.2pc on an annual basis in June, according to the National Institute of Statistics. This follows a 4.9pc fall in May, and marks the 24th straight month of decline. Earlier this month, Spain introduced new legislation to try to boost ailing retail sales that could signal the end of the country’s traditional three-hour siesta.
Data released 25.07.2012
EU 10.00 Flash HICP(July)
EU 10.00 Unemployment (June)
US 13.30 Personal Income / Consumption (June)
US 13.30 Employment Costs (Q2)
US 13.30 Case Shiller House Prices (May)
US 14.45 Chicago PMI (July)
US 15.00 Consumer Confidence (July)