Greece passed the recent April 9th hurdle, but the euro isn’t cheered up. Another Greek headline is around the corner, but more importantly, the FOMC meeting minutes still capture the market’s attention, despite their staleness.
EUR/USD is trading around 1.0740, around the lows seen last week, just before the end-of-quarter adjustments were left behind.
Greece cleared the doubts about its April 9th payment to the International Monetary Fund. The worries circled for quite some time and sent some shivers to the euro. The Greek story is always in the air: not in the headlines but not really at the back burner. This was a €460 million payment, and there are larger hurdles along the road. The summer is supposed to be “hot” for Greek finances.
The minutes from the March 17-18 meeting revealed that some members talked about raising the rate in June. Somehow, this caught market by surprise. However, it is no secret that there are hawks on the Fed board that think rates should have already been raised. Also doves exist, and these see rates rising only in 2016 – this isn’t news either.
More importantly: the meeting was held long before the terrible March NFP was released. Not only are more hawkish minutes less relevant, but Fed officials have already reacted to the jobs report, saying that it will surely impact the Fed’s decision making.
Of course, the NFP could be a one off and things will hopefully improve in Q2, but taking the minutes so seriously exposes something else: the dollar is still the cleanest shirt in the dirty pile. The euro is suffering the massive QE program, that is going on as planned.
EUR/USD has dipped its feet at 1.0730 and stronger support awaits at 1.07.
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