A look ahead to today's upcoming news and items to watch out for with 'Grexit' talk still dominating the headlines.
There is no news out of Australia today and very little across Asia, with the Bank of Japan’s Monthly Report the highlight. Traders will be looking to see if the BOJ reports a continuing theme of moderate economic recovery in Japan and overseas.
We have a relatively quiet trading day on the economic news front with Existing Home Sales the only item coming out of the US (17:00 server time). The forecast is for 5.27M compared to last month’s 5.04M, which actually missed the 5.23M forecast. If we see the number missed again it could act as an indicator that the housing market at least is not yet ready for any increase in the interest rate.
In Europe, Consumer Confidence figures will be released at the same time as the US Existing Home Sales. The forecast is for -6 matching the previous figure. The last two readings in April and May respectively have showed reducing consumer confidence and both missing forecasts, which is usually a negative sign for the Euro.
The European Union Summit has the most headline making potential as the drama surrounding a potential ‘Grexit’ continues. Clive Crook of Bloomberg said that “the only thing you can rule out is a happy ending,” pointing to the fact that whatever happens the damage is done. A Greek exit from the Euro and the EU is still very much on the cards, but should they remain and avoid what is viewed as the worst case scenario, then there are still huge mountains to overcome to get Greece back on track and keep the Eurozone together in the longer term – the single currency will regularly see these struggles as long as fiscal policy is handled by the domestic governments and monetary policy has to be determined to benefit the Eurozone as a whole. Greece and Germany have two very different views on what should be done to solve this, and that is the crux of the problem. At the close on Friday, ThinkForex clients were short on the Euro against the US Dollar as uncertainy continued to reign.