Sterling To Euro Rate Holds Ahead Of Anticipated Eurogroup Greek Bail-out Confirmation

Published: Monday, 12 March 2012 09:00 BST - Written by John Cameron

STORY LINK Sterling To Euro Rate Holds Ahead Of Anticipated Eurogroup Greek Bail-out Confirmation

The Pound Euro exchange rate is 1.1964.

Today sees yet another key eurozone summit – the latest in a succession of key eurozone summits. This time, it’s the eurogroup meeting in Brussels and one topic will dominate all others in today’s agenda – Greece’s second bail-out. It is anticipated that the eurogroup, which comprises the ECB President, Mario Draghi, the collective eurozone Finance Ministers and representatives of the EC, will rubber-stamp the next tranche of €130bn in bail-out funding for the debt-troubled Hellenic state. This follows the swap deal which Greece agreed with its creditors on Thursday, which saw over 75% of Greek bond-holders agree to take a significant ‘haircut’ on their holdings. However, in light of the apparent lack of trust between Europe’s policy-makers and Greece, a last-minute hitch in approving the bail-out funding can not be ruled out. Such an event would cause the euro to come under concerted selling pressure.

Elsewhere, the Chinese economy continued to send out worrying signals. Last night’s Chinese trade figures showed that the giant Asian economy had posted its largest trade deficit for over ten years last month. The number follows hot on the heels of the recent downgrading of the country’s domestic growth target, suggesting that Chinese leaders are less than confident about continued growth in the global economy.

Today sees a light schedule of data releases, with this evening’s monthly Budget Statement in the US providing the leading risk event of note. Unless this commentary provides any major surprises, then appetite for risk is likely to improve in anticipation of a positive outcome in Brussels later. Ceteris paribus, this should see the GBP USD exchange rate climb.

International Money Transfer? Ask our resident FX expert a money transfer question or try John's new, free, no-obligation personal service! ,where he helps every step of the way, ensuring you get the best exchange rates on your currency requirements.

TAGS: American Dollar Forecasts Daily Currency Updates Dollar Po Forecasts