EUR/USD is steady in early Monday trading, as the markets keep close tabs on today’s Eurogroup meeting in Brussels. The Euro-zone finance ministers will again huddle and attempt to reach some agreement on the vexing issue of Greece’s debt. Given the importance of today’s meeting, we could see EUR/USD react whether or not a breakthrough is achieved. There is only one scheduled economic release today, that of German Consumer Climate.
EUR/USD Technical
- Asian session: Euro/dollar was quiet and consolidated around 1.2960. The pair is unchanged in the European session.
- Current range: 1.2960 to 1.30.
Further levels in both directions:Â Â
- Below: 1.2960, 1.2880, 1.28, 1.2750, 1.2690, 1.2624, 1.2590, 1.25, 1.2440, 1.2390 and 1.2250.
- Above: 1.30, 1.3030, 1.3080, 1.3140, 1.3170, 1.3290 and 1.34.
- 1.2960 is providing weak support as the pair improves. 1.2880 is stronger.
- 1.30 is the next line on the upside.
Euro/dollar steady prior to Eurogroup meeting– click on the graph to enlarge.
EUR/USD Fundamentals
- All Day:Â Eurogroup Meetings in Brussels.
- 12:00 GfK German Consumer Climate. Exp. 6.3 points.
For more events and lines, see the EUR/USD
EUR/USD Sentiment
- Eurogroup meets (yet) again over Greece: The Euro-zone’s finance ministers are again meeting in Brussels to try and reach an agreement over the Greek debt crisis. Previous attempts to hammer out a deal have failed, as the IMF and the EU have publicly bickered over what steps to take. The main goal is to come up with an additional 10 billion euros to fill the finance gap that has resulted from the EU granting Greece two extra years to meet deficit reduction targets. Greek Finance Minister Yannis Stournaras stated that the EU and the IMF have narrowed the gap in their positions, and was confident that a compromise could be reached in today’s Eurogroup meeting. Is an agreement really close at hand, or is this just wishful thinking on Stouraras’ part? Greece continues to totter near bankruptcy and Greeks are frustrated that its lenders have not released more aid, even though the Greek government has pushed through harsh austerity measures that triggered mass demonstrations. If the deadlock continues, market sentiment could sour, and EUR/USD could lose some ground as a result.
- Euro enjoying rally: Following a sharp drop in early November, the euro has flexed some muscle in the past two weeks, gaining over 250 points against the greenback. The main catalyst for this rally has been positive Euro-zone data, including respectable PMIs and unexpectedly strong German business climate data. However, the euro continues to remain vulnerable, with the number one problem the Greek debt crisis. European finance ministers are meeting today in Brussels, as attempts continue to hammer at agreement. We could see more movement by EUR/USD following this crucial meeting.
- Ruling party in Catalonia suffers setback: Separatists in the Spanish region of Catalonia won regional elections on Sunday, but the ruling party, the CiU, lost 12 seats, complicating plans for a referendum on indepedence. The results are a victory for the central government in Madrid, which is struggling with an economy in recession and can ill afford further political turmoil. However, the separatists now control two thirds of the local parliament, and Prime Minister Mariano Rajoy’s political headaches are far from over.
- EU Summit Fails to Adopt Budget: European leaders failed to reach any agreement over the EU budget for 2014-2020. The bloc’s wealthier countries, led by the UK wanted to reduce their contributions due to the tough economic climate. Unsurprisingly, struggling members such as Greece, Portugal and Spain opposed any cuts. In the end, the gap between the two sides were too wide to bridge. European Council President Herman Van Rompuy, who presided over the summit, tried to put a brave face on the impasse, saying that he was hopeful that the “constructive discussions†at the summit could result in an agreement in early 2013.
