The euro hit fresh lows on Sunday night as the results of the Greek election became known. Throughout Monday though the euro strengthened as the Greeks reiterated their desire to stay in the Eurozone and it also received a boost from Germany’s IFO business survey, which was positive as expected, moving up to 106.7, up from last month’s figure of 105.5.
However, a positive winning streak for the single currency looks limited with the big news last week around quantitative easing from the European Central Bank (ECB). Further downside risk also seems likely with Greece’s political uncertainty and whether Athens will remain committed to the re-negotiation of the bailout. If Greece manage to re-negotiate (again), this will create further instability as anti-austerity parties in Spain and Italy will be keeping a close eye on the situation.
With very little data out today the markets will be keeping a close eye on the political rhetoric and on events elsewhere.