EU Morning Report - Euro hesitant after Greek bailout

The euro recorded gains against most of its major counterparts after the eurozone Finance Ministers reached an agreement on Greece’s second bailout on Tuesday. The Eurogroup agreed in a set of measures that are expected to cut the troubled nation’s debt to 120.5% of gross domestic product by 2020. Private sector holders of Greek bonds will accept losses of 53.5% on the nominal value of their holdings. The financial aid of EUR 130 billion by 2014 is subject to strict conditions. A report put together by the European Union, European Central Bank and International Monetary Fund highlights that Greece’s woes are far from over and the bailout program is “accident-prone”. Against the US dollar, the single currency advanced to 1.3248 from 1.3208 but failed to record a new high. Versus the British pound, the euro surged to 0.8390 from 0.8343.

The US dollar was softer versus a basket of currencies as moderate risk appetite motivates trading. Nevertheless, against the Japanese yen, the greenback maintained its February upwards trend rising to 79.84 from 79.60. The Japanese have long waited for their currency to weaken, as its strength combined with the March 2011 earthquake put the nation’s exporting economy into a very difficult position. It will be very interesting to see how trend will evolve.

The Australian dollar dropped to 1.0672 from 1.0724 against the US dollar. Reserve Bank of Australia minutes was released yesterday, noting that rate levels were 'appropriate' for the present economic environment. The British pound fell to 1.5791 from 1.5829 versus the US dollar. Bank of England Monetary Policy committee minutes for the February meeting are due at 09:30 GMT today.

Oil rose to 105.65 from 104.70 dollars a barrel. Gold climbed to 1757.11 from 1733.41 US dollars an ounce. Against the euro, gold advanced to 1329.24 from 1310.03 an ounce. Silver jumped to 34.2588 from 33.4967 dollars an ounce.

Equities	EUROPE		US		ASIA3
	FTSE 100	-0.29%			S&P 500	0.07%			NIKKEI	0.96%
	DAX	-0.58%			DJIA	0.12%			HIS	0.17%
	CAC	-0.21%			NASDAQ	-0.11%			CSI 300	1.32%