The dollar is currently weakening against all of its major competitors at the start of the new trading week. Equity markets in Europe are recovering from their sharp losses on Friday, which were sparked by the stronger than expected U.S. jobs report for June. The risk appetite of investors appears to be increasing, as they await the unofficial kick-off of the U.S. earnings reporting season later today when Alcoa reports its results.
The Greek authorities reached an accord with the troika on economic reforms that are required to unlock next tranche of bailout fund, the European Commission said in a joint statement on Monday, just hours ahead of the Eurogroup meeting.
The troika that comprises the European Union, the European Central Bank and the International Monetary Fund, agreed that the macroeconomic outlook remains broadly in line with program projections, with prospects for a gradual return to growth in 2014.
However, the outlook remains uncertain, it said. Eurozone ministers at their meeting in Brussels later today will formally decide whether to release the next tranche of EUR 8.1 billion aid to Greece. The aid funds are crucial for Athens to repay its bonds in August. The authorities committed to a number of tax reforms to secure the fund.
The Bank of France on Monday lifted growth outlook for the second quarter to 0.2 percent from 0.1 percent. A monthly survey showed that business sentiment improved in June as production in most sectors returned to growth. Moreover, the pace of foreign orders accelerated on the back of stronger demand from abroad. Business managers are expecting a further rise in activity in July.
The dollar has pulled back from an early high of $1.2810 against the Euro on Monday, to around $1.2870.
Eurozone investor confidence deteriorated in July after rising for two consecutive months, survey results from think-tank Sentix showed Monday. The investor confidence index fell to -12.6 in July from -11.6 in June, also worse-than the expected reading of -11.7.
German industrial production declined more than expected in May due to notable decline in construction and energy output, the Federal Ministry of Economics and Technology said Monday. Industrial output fell 1 percent in May from the previous month, the steepest since October 2012. Economists expected the production to fall 0.5 percent after rising 2 percent in April.
German trade surplus declined in May due to an unexpected sharp decline in exports, together with faster growth in imports, data published by Destatis showed Monday.
Mirroring weak global demand, exports dropped 2.4 percent month-on-month, confounding expectations for a 0.1 percent rise. This reversed the 1.4 percent increase in April.
Meanwhile, imports grew at a faster pace of 1.7 percent after rising 1.2 percent a month ago. Imports were forecast to remain flat in May.
Due to the fall in exports, the trade surplus fell to EUR 13.1 billion from EUR 18 billion in April. Economists had expected a more modest decline in surplus to EUR 17.6 billion.
The greenback is retreating from Friday’s nearly 4-month high of $1.4855 at the start of the new week, to around $1.4945.
Permanent staff appointments in the U.K. Increased at the fastest pace in twenty-six months in June, a report published by the Recruitment and Employment Confederation and KPMG showed Monday.
The buck is pulling back from over a 1-month high of Y101.522 on Monday, to around Y101.00.
Japan posted a current account surplus of 540.7 billion yen in May, the Ministry of Finance said on Monday, remaining in the green for the fourth straight month after three consecutive months of deficit. The headline figure missed forecasts for a surplus of 600.0 billion yen following the 750.0 billion yen surplus in April.
Japan’s economy watchers’ assessment of the current situation weakened for the third successive month in June, and by a slightly larger extent than expected by economists, latest data showed Monday.
The indicator reflecting assessment of the current economic situation dropped to 53 in June from 55.7 in May, data from the Cabinet Office revealed. The index declined for the third month in a row. Economists were looking for a score of 55.5 for June.
