EU summit hopes lift markets
This morning, financial markets continue to stabilise on the back of positive expectations from the latest EU summit. Traders seem to be impressed by the potential for Greece to stay in the euro, helped by Germany leaning more towards a pro growth policy. Whether this will cure the crisis is doubtful, but markets appear to be grateful for a bit of stability.
The Australian dollar continues to impress, with the AUD/JPY up 0.24%. The NZD/USD is not far behind, up 0.23%.
The US dollar continues to strengthen as traders switch their preferred safe haven from the yen back into the dollar. The USD/JPY is up 0.20%.
The euro is yet to join the party though, with the EUR/USD down 0.16% and the EUR/GBP down 0.19%. While there is some relief from euro stability in recent days, it seems that so far markets are sensibly taking a ´believe it when I see it´ approach.
Gold is slipping back slightly, trading down around 0.3%.
This morning we have a whole raft of UK data points from 09.30 including UK CPI, public sector net borrowing, RPI and the latest house price index. Inflation and public sector net borrowing are expected to drop sharply.
At 15.00 we have the latest US existing home sales.
The outlook for the euro is still uncertain to say the least, which makes and upside predictions particularly difficult. However, one thing that does appear apparent is that commodities have been beaten up in recent weeks, potentially pushing them into oversold territory.
With the US dollar having run to far in the other direction, the commodity heavy Australian dollar could be a good target for a rebound trade. A good way to play this might be a HIGHER trade on BetOnMarkets.com on the AUD/USD closing above 1.0000 in 31 days time (June 22nd) could return 123%.
Get this trade now, go to: http://goo.gl/KCdbb
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