Greece presents bailout plan
12 February, 2015
Yesterday with little economic data out around the world, focus was once again on the Eurozone, as the Greek government presented its first proposals for renegotiating its bailout deal to ministers at the Eurogroup meeting in Brussels.
Greece wants to change the conditions attached to 30% of its bailout obligations, presenting instead a 10 point plan of economic reforms. Time is running out as the current portion of bailout funds runs out at the end of February, and Greece needs to find €4.3bn by the end of March to repay its creditors. There is a sense that the Greek government has nothing to lose, so with EU finance ministers unlikely to accept all the proposals put forward, there is some serious negotiating ahead which is likely to give the Euro a volatile time in the coming weeks.
Yesterday the Athens stock market fell by 4% and the Euro weakened to new 7-year lows against the Pound, boosting exchange rates for those of you sending money to France, Portugal, Spain, and indeed Greece.
The EU leaders’ summit continues today.
UK inflation report – banana skin for the Pound?
Today we also have the Bank of England’s quarterly inflation report, published at 10.30am. Governor Mark Carney will give a press conference outlining the growth prospects for the UK economy, and the inflation outlook; inflation in the UK is running below the Government’s target range and Mr Carney will have to write a letter to MPs explaining what he intends to do about it. Lower inflation may sound like a good thing, but it is dangerous when too low and tends to weaken the corresponding currency; in this case of course the Pound. So across all exchange rates the press conference is an important event and likely to affect rates for your currency transfer.
Elsewhere this afternoon we have US retail sales (1.30pm); current rates for buying US Dollars are around their best so far this year. The Reserve Bank of Australia Governor, Glenn Stevens, also gives a speech tonight at 10.30pm UK time, with the Australian Dollar currently at its cheapest level since 2009, fuelled by its recent interest rate cut. Will his comments halt the fall in value of the Aussie?
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