Morning Briefing
The Morning Briefing is prepared daily at the start of the European Trading session by RTFX’s trading desk. It presents a roundup of the major news headlines occurring within the global economy that may affect the forex market. This news bulletin also includes a view of our forex calendar for the day, highs and lows achieved in the previous sessions from the forex market, global indices and commodities and brief commentary about the economic headlines.
Morning Briefing for Tuesday, 21 Feb 2012 (Updated 09:19:38 CET)Eurogroup ministers endorse second bailout for Greece
What’s new:
Asia: Asian equities lower despite Greece news
Euro Zone: Euro group ministers sign off Greek deal
Australia : No major news out of RBA Minutes
Rates in Asia and Indices:
EURUSD: 1.3293 – 1.3186.
USDCHF: 0.9149 – 0.9083.
GBPUSD: 1.5862 - 1.5808.
EURJPY: 106.00 – 105.04.
USDJPY: 79.85 – 79.55.
DowJones: 12’949.87 +0.35%
NASDAQ: 2'951.78 -0.27%
S & P 500: 1'361.23 +0.23%
Nikkei: 9’463.02 -0.23%
Shanghai: 2'381.43 +0.75%
Gold: $ 1'742.30
Crude Oil: $ 104.78
Comments:
Asian indices slipped lower or remained hesitant of greater gains despite news of Greece’s second bailout overnight.
Early Tuesday morning the Euro group ministers gave their signature to Greece’s second bailout for 130 billion euro. The IIF (representing the private bondholders) somewhat seemed hesitant of the deal as it comes greater nominal losses than previously agreed and at a lower coupon. Private sector bondholders will be asked to take up 53.5% losses on their nominal value while they had previously agreed to 50% of the nominal value.
The Greek government has reserved the right to resort to collective action clauses if private sector participation is lacking. With the current figures Greek debt is expected to come down towards 120% of GDP in 2020.
The ECB will also be contributing the profits made on the buying of Greek debt over the past years to help Greece
The fact that negotiations seemed to have come to a conclusion prior to the March 20th bond repayment helped the euro. After hitting lows of 1.3186 earlier today the EUR/USD rose to highs of 1.3293 as news of Greece’s second bailout hit the wires. The currency pair was just a few pips away of 1.33 levels and is expected to continue finding resistance ahead of 1.3329. The euro could remain supported ahead of the LTRO later this month.
In Australia minutes released for the Central Bank’s February policy meeting reiterated that current rate levels remained appropriate. The RBA remained open to further easing if the conditions demanded it.
Good Day,
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