Daily Market Report - 08/07/2015

EUR
Greece's new finance minister, Euclid Tsakalotos, attended an emergency Greek summit with Eurogroup finance ministers and European leaders in Brussels last night. It’s the first round of serious talks since Greek voters resoundingly rejected the terms of a prior bailout offer that expired on June 30.
 
Prime Minister Alexis Tsipras said his government wants debt restructuring as part of its next aid package. In the short term, Tsipras and his new finance minister Tsakalotos will probably arrive in Brussels with many of the same proposals they had before the referendum. Their main goal will be to start talks on bridge financing, to help Greece get past its upcoming financing hurdles.
 
Greece steered clear of an immediate collision with creditors by promising to put its economic proposals in writing as German Chancellor Angela Merkel warned that “only a few days” are left to reach a deal.
 
Euro-area finance chiefs will discuss Greece’s request on a conference call Wednesday morning, the first step toward restarting negotiations that Greece broke off late last month. The rapprochement lessens the risk that the European Central Bank will pull the plug on Greek banks, which are bleeding cash and have been shut for seven business days.
 
“It’s no longer a matter of weeks, but only a few days,” Merkel told reporters on Tuesday in Brussels before a summit of leaders of the 19 euro countries. Greece’s day-to-day struggle for financial survival risks hitting the wall on July 20, when the government redeems 3.5 billion euros ($3.8 billion) worth of bonds held by the ECB.

GBP

British industrial output unexpectedly rose thanks to strong oil and gas production but manufacturing fell. Industrial output rose by a monthly 0.4 percent in May, beating all forecasts from economists in a Reuters poll who had predicted a drop of 0.2 percent.
 
Oil and gas output, which had been strong in the previous two months as global oil prices began to recover from last year's fall, leapt by 7.3 percent from April, the biggest increase in more than a year.
 
The figures showed up the weakness in much of British manufacturing which makes up around 80% of total Industrial Production, something Chancellor George Osborne has said he wants to tackle in his budget announcement. Britain's economy looks set for another strong year of growth after expanding at its fastest rate in eight years in 2014.
 
Britain's manufacturers have struggled to make much headway in recent months due to a combination of weak demand in Europe and the strengthening of the pound against the Euro. A British employers' group said earlier on Tuesday that Britain's economy remained unbalanced in the second quarter when the dominant services sector grew but manufacturing was weak.
 
Key Announcements

12:30 - GBP - Annual Budget Release
19:00 - USD - FOMC Meeting Minutes