Greek Debt Optimism Gives Life to EUR/USD

Talking Points:

- New Greek government travels across Europe to meet with Troika leadership.

- Early indications suggest Greece is pushing for broad debt reduction.

- Willingness to hold audience suggests creditors may be willing to negotiate.

Greece runs the marathon distance in a sprint. The prime minster goes to Italy for talks over debt and the finance minister goes to Germany for talks with ECB and the German finance minister. This by itself is an indication that at least some kind of discussion is on the table and that both parties will sit down and discus.

Inside the country there is a widespread anticipation that at last Europe understands that some parts of the Greek program were unrealistic and that the demand for a haircut from the Greek government is more of a negotiation tool than a realistic expectation.

Capital markets rally, reflecting the expectation that a bridge finance facility will soon be available keeping Greek Banks in the EUR system and that a political deal is on the springs leaving any discussion about Grexit breathless.

EURUSD Intraday Chart (5-minutes) - February 3, 2015

--- Written by Harry Coundouris, DailyFX Greece Senior Analyst

To contact Harry Coundouris, please email [email protected]