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29 Dec 2014
Developments in Greece could impinge on ECB policy - ANZ
FXStreet (Guatemala) - Brian Martin, analyst at Australia and New Zealand Banking Group Limited noted that the euro was largely unfazed by the news of Greece but there are further risks ahead for the Euro over Greece.
Key Quotes:
“Mainly because it had reacted negatively to the announcement of the Presidential election earlier in December”.
“Meanwhile, earlier bail-outs and the comprehensive banking assessment have
de-risked the banks by bolstering their capital positions and the ECB is providing limitless funding.
Needless to say though a “Grexit”, or growing concerns about one, would raise risk premia across the euro area and force a significant re-pricing of
assets. That is something that the ECB and the new EU Commission will truly want to avoid, as will Athens”.
“In all likelihood, therefore, uncertainty in Greece will only add to pessimism towards the single currency in the short term and squeezes in EUR/USD remain selling opportunities for now”.
“Whilst Greek uncertainty may also (at the margin) dampen expectations over QE at the Jan 22 meeting, the reality that regional political developments could impinge on ECB policy settings would be negative for the EUR in our view”.
Key Quotes:
“Mainly because it had reacted negatively to the announcement of the Presidential election earlier in December”.
“Meanwhile, earlier bail-outs and the comprehensive banking assessment have
de-risked the banks by bolstering their capital positions and the ECB is providing limitless funding.
Needless to say though a “Grexit”, or growing concerns about one, would raise risk premia across the euro area and force a significant re-pricing of
assets. That is something that the ECB and the new EU Commission will truly want to avoid, as will Athens”.
“In all likelihood, therefore, uncertainty in Greece will only add to pessimism towards the single currency in the short term and squeezes in EUR/USD remain selling opportunities for now”.
“Whilst Greek uncertainty may also (at the margin) dampen expectations over QE at the Jan 22 meeting, the reality that regional political developments could impinge on ECB policy settings would be negative for the EUR in our view”.