With the German elections over and the threat of political collapse in Italy alleviated, investors are turning their focus back to one of the Eurozone nations hardest hit by the financial crisis – Greece.
After two bailouts, major political reshuffles, extensive austerity and extreme public backlash, Greece remains trapped in a record long recession, with national unemployment at a record high and the necessity of a third aid package increasing.
Current Greek Prime Minister Antonis Samaras is now entering perhaps the most difficult time in his 16 month term. The last Greek aid programme is due to end next year, and the fact that the nation needs additional fiscal assistance is an unavoidable one. But as German Chancellor Angela Merkel has vetoed the possibility of official Greek loans being written off, a similar bailout package to that offered last year is looking like the most likely scenario.
The Euro/Pound Sterling pairing is currently trading in the region of 0.8489
According to one industry expert; ‘Samaras is under continuous pressure at home because of the high level of despair and anger among citizens. He needs support from European partners and at the same time he needs to show Greeks that he’s a hard bargainer. In the current environment, no Greek government would feel strong and comfortable’.
At today’s meeting of Eurozone Finance Ministers in Luxembourg, Greek aid is expected to be one of the topics under discussion.
Over the last six years Greece has floundered and spawned repeated fears of a breakdown of the currency bloc, but the collective efforts of the Eurozone’s creditors have so-far helped the nation cling on.
Given how far Greece has already been carried it seems unlikely that lenders won’t take the country all the way to the finish line, although there are sure to be month’s of discussion before any package is agreed.
In Euro news, the common currency began the European session stronger against the US Dollar as default concerns continued and US markets closed for a national holiday.
The Euro was also able to largely retain recent gains against the Pound over the weekend, although the EUR/GBP pairing was down slightly from Friday’s close.
In a comparatively quiet news day Euro movement is most likely to occur in response to Eurozone industrial production figures, due out at 10:00 GMT.
Euro (EUR) Exchange Rates
As of 09:10
The Euro/US Dollar Exchange Rate is currently in the region of: 1.3560 >
The Euro/Pound Sterling Exchange Rate is currently in the region of: 0.8489 <
The Euro/Australian Dollar Exchange Rate is currently in the region of: 1.4342 <
The Euro/ New Zealand Dollar Exchange Rate is currently in the region of: 1.6258 <
The Euro/ Canadian Dollar Exchange Rate is currently in the region of: 1.4041 >