Yesterday’s post detailed how the AUD has lost value due to shock news about commodity price drops. Today another shocking leak from an IMF produced a report saying that they do not agree with the Greek bailout proposals. This gives ammunition to those in the Greek parliament hoping to reject the offered proposals. As such, more nervous investors have flown into safe haven currencies such as Sterling, the corollary being that this has artificially boosted the Pounds secondary currency pairings such as GBP-AUD.
But the move upwards was slight. Most of this money went into the Dollar rather than the Pound, due to comments made by George Osborne, the UK Chancellor. He was adamant that he would not pay any UK funds into the Greek bridging loan, which has caused concerns about the UK relationship with the Eurozone. Essentially the UK is not as desirable as it once was as problems grow with the European mainland.
The vote in Greece is scheduled for 10pm GMT, but I would not bank on it as these processes tend to drag on. Breaking news is that more than half of the Syriza party are against the deal. Will they be able to turn this around? We’ll see later tonight.
This will not affect the bridging loan offered to Greece to keep their banks afloat. Like all the times before this, the end goal for both parties is keeping the country in the Eurozone, this is just more of the same delays.
Depending on what happens overnight this could provide short term buying opportunities for the AUD – email me on [email protected] to discuss the news overnight – I will be awake at 4am to see how Sterling is trading on the Asian markets and can provide a comprehensive idea of whether this is indeed the top of the market to buy AUD. 01494 787 478