After weeks of stagnation the EU made a step towards a new program of financial aid to Greece. Nevertheless, Europe reluctantly starts to understand that it has to pay for keeping Greece in the union. Athens will at last get 34.4 billion Euros. Still the measures undertaken in order to relieve debts still don’t bring too much optimism. The reduction of interest rates for bilateral credits is hardly the best solution: it might force the countries in the tough situation like Italy and Spain to credit Greece at their own expense, while Germany will still get a small profit. Discussed terms of relief are also too insignificant. Greece is not likely to have enough time to stimulate the economy growth and to pay the debt. The political reasons behind such cautiousness are evident. It is difficult to ask national parliaments to accept a more ambitious plan for debt relief while Cyprus and Spain might be the next in the list. The other obstacle is German elections in 2013. Anyway the crisis can’t be solved without restoring the balance between creditors and debtors. In the long run the forecasts of growth in Greece might be too optimistic. In any case the governmental sector will have to fill the gap. To round it off the reached agreements are sufficient only to keep Greece economy alive.
The Euro appreciated against the US Dollar from 1.2982 to 1.3126. Then the rate tested the minimum of 1.2876 with further bounce to 1.2924.An abrupt drop of the Euro has two reasons. Frits of all, it is a reflection of consequences of the ECB head Mario Draghi comments about the rates and further monetary policy. The second negative factor was the downgrade of economic forecast of Greece by Bundesbank in 2013 from 1.6% to 0.4%. Analysts forecast the continuation of sales’ pressure for the net trading week. The boundary above is 1.3140. The main support is around 1.2870.
Last week the Pound grew against the US Dollar from 1.6001 to 1.6130 with subsequent dip to ? 1.6041. The technical picture of the British currency looks quite bad and it aroused serious concerns about the perspectives of its future growth. The resistance above is at 1.6240. The key support is at 1.5930.