Another day in the red? What's new?! The euro lost ground against the Greenback and the Japanese yen as EUR/USD ended the day at 1.2286 while EUR/JPY closed at 96.90. Will the euro have a chance to bounce back today?
Even though the euro zone didn't release any economic data yesterday, the euro was sold off heavily thanks to news reports showing that Greece might need an extension of their ongoing austerity program The report revealed that the debt-ridden nation might miss its deficit targets AGAIN and that they'd need more time to come up with the 11.5 billion EUR in spending cuts. Better keep your eyes and ears peeled for any updates since the Greek Prime Minister is scheduled to meet with Merkel, Hollande, and Juncker to discuss their options next week.
Another factor that probably triggered the euro's selloff yesterday was the rumor that the SNB was already starting to diversify out of their euro holdings. After all, holding on to their EUR/CHF has proven to be expensive for the central bank and they might be thinking of accumulating reserves in other currencies instead. Although these are nothing more than rumors for now, stay on your toes in case the SNB confirms these plans!
The euro zone is set to release its CPI figures for July at 9:00 am GMT today. The headline figure is expected to show a 2.4% annualized increase while the core figure could post a 1.7% yearly rise. Don't forget that the U.S. is also set to print a few high-profile reports, namely its building permits, housing starts, and Philly Fed index.
Take note that the U.S. dollar has been reacting to fundamentals lately, which means that weaker than expected U.S. data could trigger a dollar selloff and be positive for the euro... Unless the euro zone comes up with another set of bad news, that is!