After a quiet start to the week where the dollar just paused for breath, the single currency is coming under renewed pressure this morning, in particular against the Yen as EURJPY has hit a near two year low overnight. Reports that Greece is preparing to default on its up and coming IMF loan repayments in May and June unless a deal is struck by the end of this month have done little to attract buyers of the euro and we’re unlikely to see any upside for some time given that QE has only just got underway. Investors have also been increasing the chances of Greece leaving the Eurozone within a year and given the lack of agreement, in what seem to be never ending negotiations, there a greater chance of these odds rising. This issue is likely to be a focus at tomorrow’s ECB meeting. Meanwhile EURUSD continues to hover above its multi-year lows around the 1.0500-1.0450 area at 1.0545 and today the focus will be on inflation data from a few Eurozone members and in the UK.
GBPUSD is holding its own this morning at 1.4675 however today’s inflation release will be important to see if it can maintain these levels. Whilst expectations are for a print of 0.0% in the Y / Y figure anything lower than this could see a test of lows in the mid 1.4500 region.