MORNING BRIEFING: Refinancing price of debt too high for Greece

[RTFX-Trading]

MORNING BRIEFING: Refinancing price of debt too high for Greece

What’s new :
United States: zero inflation in February
United States: Health program will reduce the deficit, President Obama
Great Britain: Decline of public borrowing
Euro area: Press conference by Mr. Trichet at 8:45 CET
Euro area: EU summit in Brussels March 25th
Greece: Unable to achieve the objectives at the current cost of refinancing
Switzerland: CHF at the highest against EUR cons since 17 months
Precious metals: Gold remains firm

Today:


Rates in Asia and Indices:
EURUSD: 1.3627 - 1.3601.
USDCHF: 1.0584 - 1.0568.
EURUSD: 1.5256 - 1.5221.
EURJPY: 123.35 - 122.90.
USDJPY: 90.59 - 90.34.
DowJones: 10'779 .17 + 0.42%
NASDAQ: 2'391.28 +0.09%
S & P 500: 1'165.83 -0.03%
Nikkei: 10'824.72 +0.75%
Shanghai: 3'057.28 +0.37%
Gold: $ 1'122 .70
Crude Oil: $ 81.28

Comments:
The consumer prices index, published yesterday in the United States, showed zero inflation for February, with one year to another rate at 1.3%, the lowest in 6 years. If these figures seem to confirm Fed’s policy of low interest rates, some caution is needed as the decline of 0.5% of energy prices and the strong dollar reducing the prices of imports are two important factors for this ‘zero inflation'.

The overhaul of the health system in the United States should serve as an incentive for growth and help cut the budget deficit in 10 years, according to President Obama.

Figures a little more positive in Britain yesterday, with public borrowing lower than expected showing expenditures below those budgeted, while the increase in home loans from January to February is less significant, mainly because due to very bad weather in January.

The President of the European Central Bank, Mr Jean-Claude Trichet, holds a press conference this morning at 8:45 CET.

Greek Prime Minister Mr. Papandreou has set at the EU summit on March 25th the dead line for the countries of the Euro zone to unveil their plan for aid to Greece.

Greek officials have declared that it will be difficult for Greece to achieve its objectives of reducing the budget deficit if the refinancing costs remained too high.

The Swiss franc reached its highest level in 17 months against the euro, fears about the fate of the European currency combined with recent positive Swiss economic data bringing back to investors their reflexes of safe currency!

The same reasons, fears on the EUR, benefits also to gold which found renewed interest.

Have a good week end

Pascal Bovay

RTFX Ltd
Trading desk
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