IIFT Daily Note with Peter Brown

Are Eurozone worries back?

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We have had a quiet period in regards the Eurozone. Mr Draghi’s OMT programme has brought stability for a year. Now however Portugal is back in the headlines on austerity, leading to political unrest. The reality in the Eurozone is that the debt is still there. Nobody has fixed anything. A lack of confidence in implementing austerity measures will have the effect of rising bond yields, as we are seeing in Portugal. This could bring the crisis back to the forefront. Over the last few months we have concentrated on US QE tapering and Japan, is this about to change?

Unrest in Egypt has also got the oil market nervous. Looks like the volatility is set to continue throughout the summer.

Today we have the ECB interest rate decision. Expect no change. And Draghi speaks, expect little there too.

Tomorrow we have NPF. Major action there and we will look at that in tomorrows blog.

Yesterday’s trading range held on the S&P so more of the same today  1620  1595

Euro is looking week but not going to collapse just yet . Sell on rallies 1.3040   1.2920 support

USD/JPY decided to have a profit take and fell through support at 100.30 reaching a low at 99.30  very skittish market at the moment anything can happen.

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