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The Greek Prime Minister is scheduled to meet with the leaders of France and Germany today for crunch talks in which he is expected to ask for more time to hit the goals outlined as part of their bailout. Since taking over earlier this summer Antonis Samaras has made great strides to get Greece back on track, actions that have pleased auditors. Armed with glowing references and proof of progress in his home nation, Samaras is expected to ask for austerity measures to be softened in a bid to stimulate their economy back into life.
As the Greek PM touched down news of the Euro’s fall by 0.2% based on the meeting he was about to have will have filtered through to him, however the single currency is expected to drop further. Various politicians and officials from Germany, who are extremely pro-austerity as a whole, have already suggested that there will be “no leeway whatsoever” during the negotiations.
This leaves the Eurozone in a difficult situation as it faces the very real possibility that Greece will leave the 17-nation currency, reducing demand and ultimately its value. Should the German officials crack and offer new terms then it would set a precedent for other distressed countries who would expect the same treatment.
The Euro was sitting at $1.2536 against the dollar just before 11am this morning in London, cutting into this week’s rise to $1.2590, a six week high, and also lost 0.1% against the Yen.
Samaras has been concerned with the terms that his country’s previous administration had agreed to, feeling that it forced people to accept drastically worse living conditions and lifestyles as a whole.
The US dollar continued its recent gains today, making ground on pretty much every currency of note as investors looked for a safe haven – a familiar story in times of risk avoidance. The British Pound however enjoys no such glamorous role within the global economy. After government data was released showing that the nations GDP had contracted by 0.2% more than preliminary reports had suggested last month. As such the Sterling fell by 0.1% against the dollar and pretty much matched the Euro in its decline.
The Australian dollar continued to fall, losing 1% on the US dollar over the last 48 hours. A fall of 0.4% today left the “Aussie” at $1.0400.