Euro Opens Lower Ahead of EU Summit

The euro tentatively declined in early trading to open the week as the focus sharpens on the upcoming EU Summit. In Fridays CFTC data, the net US dollar position was cut by 43% on a plunge in euro shorts. Latest Premium Insights include 10 new trades from Thursday, including GBPJPY, EURJPY & EURUSD. See more below.

Italy may have beat England but the euro is lagging the pound to begin the trading week. The calendar is light around the globe and the market is focused on the EU summit beginning Wednesday.

Health problems for Greek new Prime Minister and finance minister will prevent them from attending and have forced the Troika to delay an initial consultation. The problems are minor but could delay bailout renegotiations.

Austrian fin min Fekter said she is open to negotiations about prolonging the timetable for Greek reform but Germany continues to drive a hard line. Fin min Schaeuble said Greece needs to stop asking for help and follow through on its promises. He also ruled out Eurobonds once again.

Schaeuble will not be encouraged by a report in a Greek weekly that said the nation has added 70,000 public sector jobs since 2010. The jobs were to replace retiring public sector workers but many came after Greece said it would replace just 1-in-5 departures.

Also in Germany, the upper house has agreed to ratify the ESM after state leaders were placated with additional funds.

Fridays CFTC report showed the euro net position down 27% to -141K while yen longs rose by a similar proportion to +15K and GBP shorts were cut by 25%.

Shorts on the Australian dollar were nearly cut in half while NZD shorts were trimmed by 42%. The Canadian dollar remains in a net positive position, but 14% less than a week ago.

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-AB