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Body blow for Greece

Greece took a bit of a body blow late yesterday as the ECB has made it clear that it is not willing to keep the liquidity flowing or accept the proposed solution from Greece of recalibrating the terms of existing debt structures and thus simply lending them more money. Investors shunned equities late last night as the Dow Jones dipped towards the close and one again, for the umpteenth time the FTSE 100 has rejected a move to test its all-time record high. The euro has dipped with EURUSD swiftly rejecting the 1.1500 level and now sits at 1.1380, however there’s not been a mad rush to the exits for the single currency as this move by the ECB is unlikely to dent the political resolve to keep the Eurozone intact.

Markets are still very much in limbo at the moment with the US dollar not regaining its upward momentum. US Treasuries simply haven’t seen their yields recover so slowly but surely investors seem to be accepting the fact that the Federal Reserve is going to move later than markets are currently expecting. Yesterday’s lower than expected ADP private payroll is a case in point that shows US economic data looking a little tired.

Today sees the Bank of England rate decision which is a foregone conclusion, but GBPUSD ought to be monitored as it continues to test near term resistance around and just above the 1.5200 level.

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