EUR
Continued fears over a Greek exit from the Eurozone helped push the Euro
currency lower. It came after the head of the Eurozone finance ministers’
group called on Greece to “stop wasting time” and engage in serious
talks on reform. Mario Draghi also spoke and expects domestic demand to
improve over the course of the year as positive effects of the bond-buying
programme gain momentum. He also said that demand for European exports should

EUR
Continued fears over a Greek exit from the Eurozone helped push the Euro
currency lower. It came after the head of the Eurozone finance ministers’
group called on Greece to “stop wasting time” and engage in serious
talks on reform. Mario Draghi also spoke and expects domestic demand to
improve over the course of the year as positive effects of the bond-buying
programme gain momentum. He also said that demand for European exports should
increase as prices become more competitive, due to a weaker euro.

In Germany the BGA trade association raised its forecast for exports,
expecting the weaker euro to offset uncertainty surrounding crises in Greece
and Ukraine.It said it expected exports to grow 4.5% this year, up from a
previous forecast of 4%. Imports are forecast to rise 4% which would increase
Germany’s trade surplus to a record €231bn, BGA said.

Yesterday it was announced that France has been granted a 2 year deficit
extension. This is the third extension France has been granted since 2009 to
bring its budget deficit below 3% of GDP, as mandated by EU
regulations. France’s budget deficit is expected to be 4.1% of GDP this
year, as it struggles with high unemployment. The ministers justified the
extension by looking back on the Fiscal efforts made by France since 2013. However,
they called for “additional fiscal effort” by the end of April 2015
involving additional structural measures that would allow it to reduce its
deficit by 0.2% of GDP.

GBP
In the UK Bank Of England Governor Mark Carney spoke in the House of
Lords yesterday. He stated that Inflation is likely to remain close to zero for
much of 2015. Carney also mentioned that Most of the falls in CPI were due
to weakness in commodity prices such as oil. He also stated that he sees UK
output growth remaining solid and increasing signs that wages are picking up. A
Gentle rise in interest rates is likely and consistent with mandate. Finally
Carney said that the medium term risk to financial stability remains from the housing
market.

Key
Announcements:
GBP – 09:30 – UK Industrial Production (JAN) expected to rise to 1.3% from
0.5%
GBP – 15:00 – NIESR GDP Estimate 

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