Concerns about situations involving Greece, Italy and the European Central Bank kept the euro under pressure on Tuesday.
European
geopolitical fears sapped risk appetite, weighing on Asian stocks and
lifting safe havens including the yen and gold, though trading was thin
with several markets closed for holidays.
For Tuesday, European stock markets were set for a soft start, with financial spreadbetter IG Markets expecting Britain's FTSE .FTSE and France's CAC 40 .FCHI to open 0.15 percent and 0.3 percent lower, respectively, and Germany's DAX .GDAXI to start the day flat.
The euro EUR=EBS slid 0.45 percent to $1.1114 in its fourth session of declines.
James Woods, global investment analyst at Rivkin Securities in Sydney, attributed most of the currency's decline on Tuesday to a German press report saying Athens may opt out of its next bailout payment if creditors cannot strike a debt relief deal.
"The bailout payments are necessary to meet existing debt repayments due in July, so if Greece were to forgo this bailout payment the probability of a default would spike, reopening the discussion around a Grexit from the Euro zone," Woods said.
However, he cautioned against reading "too much into it" without more details or confirmation, adding it was unlikely Greece would forgo the bailout payment at this stage.
Euro zone finance ministers failed to agree with the International Monetary Fund on Greek debt relief or to release new loans to Athens last week, but did come close enough to aim to do both at their June meeting.
Comments by former Italian Prime Minister Matteo Renzi on Sunday in favor of holding an election at the same time as Germany's in September also raised uncertainty and pulled the euro lower.
For Tuesday, European stock markets were set for a soft start, with financial spreadbetter IG Markets expecting Britain's FTSE .FTSE and France's CAC 40 .FCHI to open 0.15 percent and 0.3 percent lower, respectively, and Germany's DAX .GDAXI to start the day flat.
The euro EUR=EBS slid 0.45 percent to $1.1114 in its fourth session of declines.
James Woods, global investment analyst at Rivkin Securities in Sydney, attributed most of the currency's decline on Tuesday to a German press report saying Athens may opt out of its next bailout payment if creditors cannot strike a debt relief deal.
"The bailout payments are necessary to meet existing debt repayments due in July, so if Greece were to forgo this bailout payment the probability of a default would spike, reopening the discussion around a Grexit from the Euro zone," Woods said.
However, he cautioned against reading "too much into it" without more details or confirmation, adding it was unlikely Greece would forgo the bailout payment at this stage.
Euro zone finance ministers failed to agree with the International Monetary Fund on Greek debt relief or to release new loans to Athens last week, but did come close enough to aim to do both at their June meeting.
Comments by former Italian Prime Minister Matteo Renzi on Sunday in favor of holding an election at the same time as Germany's in September also raised uncertainty and pulled the euro lower.
No comments:
Post a Comment