The finance ministers of the euro-zone spent a busy night in Brussels, but did not reach any results: the parties were unable to reach a conclusion on the way forward for Greece and decided to continue talking and meet again in the next meeting, due on Monday.
For the euro, this “as expected†outcome left the pair very stable in range. Are we seeing the calm before the storm?
Euro-politics
The Greek government is still new: less than 3 weeks in office. The proposals that it made were heard by Germany and other members but the sides are still digesting the data and are still wide apart.
There is another factor here: the German state of Hamburg holds state elections on Sunday, and Merkel would not like to anger her voters on the sensitive topic of Greece just a few days before the event.
A planned Eurogroup meeting is scheduled for Monday, and it’s safe to assume that negotiations will continue throughout the weekend.
Will we get a new deal for Greece by then? This is uncertain, but we expect some progress: nobody wants a Greek exit out of the euro-zone and the baseline scenario remains that some kind of compromise will be achieved.
EUR/USD
For EUR/USD, we are experiencing one of the more stable weeks in a long time. The pair is clinging to 1.13 and not letting go. Such tight trading usually leads to an explosion in one direction or another.
In the US, we have retail sales and jobless claims later on, and these could set the tone for the other side of the pair. It’s not only Greece.
More:Â EUR/USD: Where Would Specs Reaccess A Short Position?
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