Greece's international lenders agreed on a package of measures to cut Greek debt to 124% of its GDP by 2020, Furthermore, Greece will try and take its debt burdens down further to 110% by 2022, while EU and IMF policymakers agreed to trim interest rates on Greek loans, extend their maturity by 15-30 years, and grant the country a 10-year interest repayment deferral.
This deal is only a draft at this stage as Germany needs her parliament approval first. The Euro-group has set December 13 for the formal approval of the disbursement.
Meanwhile in the US, Republicans in Congress called on President Barack Obama, yesterday, to detail its long-term spending cuts in order to solve the country's fiscal crisis but even though it seems as if both parties are getting closer, both parties are holding firm against the income tax rate increases for the wealthy that Democrats seek.
The markets are expected to look for signs and clues regarding any progress that is made but it will probably stay nervous in particular if the negotiation drags on.
The economic calendar for today is busy with data both from the EU and the US. UK GDP and Italy Inflation report are expected this morning while, the U.S. is to release official data on durable goods orders, a leading indicator of production, as well as industry data on house price inflation.
In addition, the Conference Board is to publish data on U.S. consumer confidence, while Federal Reserve Chairman Ben Bernanke is to deliver brief remarks at the National College Fed Challenge Finals, in Washington D.C.
EUR/USD The euro gained against the dollar in the Asian trading today after the news that the IMF and EU policymakers agreed on debt targets for Greece needed to free up aid for the cash-strapped country. But it looks as if the gains are capped by the 1.3000 mark and by week hands that preferred to go side lines ahead of the Dec 13th decision and the US fiscal cliff negotiations.
On the technical side, It looks as if the Euro is talking a breath before it will breach and stay above the psychology level of 1.3000 but at this levels, it’s better to stay side lines and see how it plays out.