Good morning.
The focus of the EU crisis is now slowly shifting to Italy although the political crisis in Greece is remains unresolved. Greek Prime Minister George Papandreou has agreed to step down shortly after winning the confidence vote. The country’s elections will be held in February and former European Central Bank vice president Papademos is expected to run the show in the interim. His central bank experience may come handy in handling the crisis, though it’s not exactly the Greek government who’s calling the shots. Greece’s domestic policies are now dictated mostly by the ECB, EU and the IMF. The situation was further exacerbated by outgoing PM Papandreou.
EU finance ministers will be meeting later today to discuss the latest tranche of €8 billion bailout money to Greece, which the Greece finance minister said is absolutely necessary to keep the country afloat. However, Italy’s deteriorating situation is expected to dominate the EU finance ministers’ meeting.
IMF chief Christian Lagarde is in Russia to meet President Dmitri Medvedev, ostensibly to discuss the European crisis. Russia has relatively low budget deficit and public debt levels and is Europe’s biggest energy supplier. Though it has not been hit by the EU crisis, a contagion may affect its biggest energy market adversely. Kremlin has already expressed its willingness to contribute to the EFSF through the IMF. The IMF chief is expected to visit China and Japan seeking support for expanding the EFSF bailout fund. All the three countries had expressed willingness to participate in expanding the lifeboat fund’s lending capacity.
CURRENCY RATES OVERVIEW
GBP/EURO – 1.1651
GBP/US$ – 1.5986
GBP/CHF – 1.4420
GBP/CAN$ – 1.6318
GBP/AUS$ – 1.5538
GBP/ZAR – 12.7652
GBP/JPY – 124.98
GBP/HKD – 12.4326
GBP/NZD – 2.0173
GBP/SEK – 10.5960
If your currency pairing is not listed above and you want to make a currency transfer, check out our comparison tables at www.mycurrencytransfer.com for the best foreign exchange rates.
Euro: The single currency sits low despite Greece uncertainty receding, albeit slowly. Attention is now shifting to Italy though Prime Minister Berlusconi has agreed to an IMF monitoring of the country’s economy, a pre-condition for availing bail-out funds. Italy is expected to remain in focus the entire week. The GBP/EUR pair opens at 1.1657 this morning while the EUR/USD sits at 1.3730.
USD: Cable traded on either side of the 1.1600 level against the greenback on Friday, mirroring the recent uncertainty. The US better-than-expected employment figure boosted the greenback further as investors remained risk-averse. Italy is expected to remain in focus this week. GBP/USD pair opens lower at 1.5990 this morning.
Elsewhere, the AUD and the NZD lost ground against the greenback. The antipodean currencies saw little movement against the Sterling on Friday while the Swiss Franc gained against most currencies this morning.
Have a great day!
