Adam Myers, European Head of FX Strategy

Manuel Oliveri, FX Strategist

Overnight risk sentiment was stable with US stock futures trading broadly flat at the time of writing. This is mainly due to rising expectations of EU Finance Ministers agreeing on a temporary solution for Greece. However, it appears too early to expect a major agreement as soon as today.

It must be noted too that officials including German Finance Minister Schaeuble already indicated that no deal is imminent.

Accordingly Greece-related uncertainty is likely to remain intact.

Even in the case of a more positive development we expect EUR rallies to remain a sell as strongly capped ECB monetary policy expectations should ultimately prove the single currency’s more sustainable driver.

Hence we remain short EUR/USD.