Amid the absence of fundamentals from the U.K. and U.S. as well as other major economies, the main focus remained on the latest developments in the euro where the sentiment showed a slight improvement before Chancellor Angela Merkel meets today with the President of the International Monetary Fund Lagarde, causing the pair to rise for the second day.
The pair did a downside correction to halt the downside direction on Monday after Merkel-Sarkozy meeting in Berlin which tackled a rule book for closer fiscal compact in the euro zone.
Now, there is slight optimism European leaders are on their way to resolve the crisis before they meet in the EU summit on January 30.
On Tuesday The Greek government sold 1.625 billion euros of six-month notes with a decline in yield to 4.90% compared with 4.95% in December’s auction.
This week, more attention will be given to Spain and Italy as Spain will sell bills maturing in 2015 and 2016, while Italy is expected to auction 3-, 5- and 15- year bills.
On Wednesday, U.K. visible trade balance report for the month of Nov. will be due at 09:30 GMT, where expectations refer to a widening in the deficit to 8350 million pounds from 7557 million pounds a month before.
In the U.S., MBA mortgage applications for Jan. 6 will be released at 12:00 GMT, followed by Fed’s Beige Book at 19:00 GMT.
The data is expected to affect the pair’s movement, yet the pair will probably be more affected by the general sentiment which is focusing on the latest developments from the euro zone.
Originally posted here
