This morning we see the release of the much anticipated Eurozone Consumer Confidence figures. The figures are expected to hit a record four-month low, with the readings expected to reinforce the growing fears of the general discomfort in the peripheries surrounding namely Spain and Italy.
Eurozone Finance Ministers are due to meet in Brussels today, where they are facing heavy pressure to find solutions and increase their efforts when dealing with the debt crisis. Most noticeably, Spain is set to release the results of an audit which is intended to put a firm ‘price tag’ on recapitalizing the country’s banking sector.
Yesterday, Greek stocks rose moderately in response to the news that a coalition had been formed with Athens, with shares closing up 0.5%. This gave some hope in the markets as Antonis Samaras was swamped in as new prime minister; his party has forged a coalition with the socialists and the smaller Democratic Party.
Minutes to the BoE's June meeting showed stronger support for more quantitative easing (QE) than many economists had expected but markets were already geared for such a scenario after a speech by governor Mervyn King last week. Weak labour data also bolstered the view that the BoE could resort to another round of gilt purchases as early as next month. The latest minutes showed four policymakers voted to increase the £325 billion total QE asset purchase programme, compared to just one in the previous month.
In the U.S, the Fed has expanded its "Operation Twist" by $267 billion, this means it will buy long-term securities and at the same time sell the same amount of short-term securities. The outlook for the USD still remains apprehensive, with more traders likely to position themselves for fresh stimulus following the central bank's move to downgrade its U.S. growth forecast.
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