Greece feels the pressure

The UK economy continues to be a good news story but the Bank of England's latest minutes suggest markets might be overly complacent about the timing of an interest rate hike.
Starting with; all nine members of the MPC committee voting against an interest rate rise anytime soon. Technically speaking this should not reflect in currency strength, however, in the minutes after the vote yesterday there were some hawkish comments made that strengthened sterling in the afternoon session across all major counterparties. Sterling traded back up over the 1.40 level on IB (Interbank) against the euro and posted a daily high of 1.4040 IB. This was a compelling move considering the rate was trading at 1.3875 IB when the opening bell rang. Similarly, GBP/USD broke that psychological level of 1.50 IB and closed the London session at 1.5020 IB. It will remain quiet for the UK calendar for the rest of the week, with the exception of Retails Sales and Markit Manufacturing and Services PMI later this morning. The likelihood of this event being priced into the market is very high as they are medium tier data. However, if this sector misses the consensus we might witness some sterling weakness. Furthermore, with the election looming on the 7th of May it’s a likely outcome that sterling is going weaken if the SNP’s are elected to government.

The only release worth mentioning from yesterday’s session is Consumer Confidence which brought more negative news to the struggling economy producing a figure of -5 from a previous -4 which is compelling difference in the space of one month. Surprisingly, this did not depreciate the euro against the greenback and it peaked to a daily high of EUR/USD 1.080 IB yesterday. The situation in Greece will continue to focus minds with the country's prime minister Alexis Tsipras due to meet with Germany's Angela Merkel in Brussels today.
Greece's government has yet to find an accommodation with its creditors and is facing pressure at home to live up to its campaign promises. Eurozone finance ministers will meet in Latvia on Friday to discuss the Greek crisis and try to broker a positive outcome. Eurozone PMI data later today should signal whether or not actions by the European Central Bank through its quantitative easing are having an effect.

Across the Atlantic, the Americans witnessed some surprising (positive) data releases. Existing Home Sales Change for the month of March took a compelling jump to 6.1% from a previous 1.5%. Additionally, Existing Homes Sales increased to 5.19m from a previous 4.89m which proves that the housing market is still on the incline and is the backbone of the world’s largest economy. The US calendar will have a very busy afternoon so expect some volatility if the consensus figures are missed. Furthermore, Friday will bring the release of Durable Goods for the month of March which is forecasted to read at 0.8% from a previous -1.4.