Mike Paterson’s daily Forex brief

Yesterday saw the New Democracy party win 129 seats or 29.66% of the Greek election vote just ahead of Syriza (71 and 26.89%). Not enough to form an outright government and Syriza will prove a potent opposition force but the market nonetheless breathed a sigh of relief.

We saw the Euro initially surge across the board but then cap as the reality check once again kicked in. EURUSD has been up to 1.2748 but currently down to 1.2694 and falling further as I type, EURGBP also rose sharply to 0.8112 (GBPEUR 1.2326) before heading back down, and EURJPY up to 100.86 before it too ran out of steam.

The fact that ND leader Samaras has to form a coalition and will try to get Greece cut some slack on the bailout terms leaves the jury well and truly out on this one amidst concerns remaining for Spain and the Eurozone as a whole.

The Euro has just fallen further (1.2635, 0.8066, 99.90) as Spanish bond yields once again touch 7% after news that Spanish bank bad loans rose to 8.72% in March, the highest since April 1994.

So it looks like a short-lived honeymoon for the Euro but we’ll see good two-way business in ever fickle markets.

The Pound has lost a few a few of its gains made on Friday when GBPUSD found large buying interest throughout the day and surged through 1.5700 giving the Pound a good fillip across the board and we can expect plenty of two-way trading here too.

No data of note out today but tomorrow sees a raft of figures including the latest UK inflation data.

And in the world of sport David Nalbandian was disqualified when leading the Queens tennis final after kicking a line-judge “protective” board in frustration which in turn kicked the line-judge himself drawing blood from a nasty gash to the shin, and Webb Simpson (who? Ed) won the US Open becoming the 15th different major winner in a row, the ninth straight first-time winner and the third consecutive American to win one of golf's grand slam events.

Forex Update-The Economic Voice Limited

Forex Update-The Economic Voice Limited

And Happy 70th Birthday to Sir Paul “Macca” McCartney, a well-known bass player for a popular beat combo some years ago who changed the face of music as we know it but who now gets wheeled out for every national flag-waving event going. Missed another obvious rendition of Let it Be at the recent Jubilee concert? Never mind, the Olympic closing ceremony will be along soon.

Have a great week out there.

Interbank Rates 08:41 BST

Currency Pair

Current

Overnight

High Low
EUR/USD 1.2694 1.2748 1.2635
GBP/USD 1.5687 1.5744 1.5675
EUR/GBP 0.8088 0.8112 0.8040
GBP/EUR 1.2360 1.2438 1.2326
GBP/CHF 1.4848 1.4942 1.4808
GBP/AUD 1.5527 1.5596 1.5494
EUR/CHF 1.2009 1.2019 1.2008
GBP/HKD 12.1621 12.2063 12.1528
EUR/HKD 9.8398 9.9028 9.1528
GBP/ZAR 12.7845 13.2031 12.9236
USD/JPY 79.26 79.32 78.68
GBP/CZK 31.3610 31.6945 31.1557

Today’s Data: BST

Nothing of note.

Agree or disagree? Then please leave a comment in the box below or contact me by e-mail.

Mike ‘Oscar’ Paterson has been in the Forex trenches for nearly three decades working as a senior Spot trader in London at UBS, Chief Dealer FX at the State Bank of Victoria and in charge of Spot CHF at Credit Suisse with a daily turnover in excess of $1.5 billion. Mike now works as an independent consultant providing a fully bespoke service to the corporate and private sectors in physical FX delivery as well as guiding those who wish to improve their currency trading. Mike also presents seminars and workshops and writes for a number of publications.
To contact Mike please call +0044 (0) 1732 700383 or email mike.paterson@economicvoice.com
The views expressed above are those of the author and should not be taken as investment advice. MSP Foreign Exchange Services will have no liability for, or to, any persons executing trades based on the content above.

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