Euro dipped overnight as ECB toughened its stance on Greece. Just hours after Greek finance minister Yanis Varoufakis met ECB president Mario Draghi, the central bank announced to suspend the Greek collateral waiver for regular lending facilities. That is, ECB will no longer accept junk graded Greek government bonds as collateral for regular central bank loans. It's seen as a major blow to the new government's proposal to rewrite the terms of the EUR 240b bailout package. ECB said in the statement that "it is currently not possible to assume a successful conclusion of the program review". While it's expected that ECB would take a harder line on the Greece, the move was seen as earlier than expected by some analysts. It's reported that Greece could now run out of cash as early as on February 25 unless the EUR 15b limit on short term borrowing set by troika is raised.
Technically, Euro's recovery against dollar, yen and sterling could be completed. EUR/USD was held below 1.1678 near term resistance and maintained near term bearish outlook. Break of 1.1311 will bring retest of recent low at 1.1096. EUR/JPY was also limited below 137.63 resistance and focus in now back on 132.37 minor support. Break will bring retest of recent low at 130.13. Even EUR/USD was limited by 0.7594 resistance and is possibly now heading back to 0.7403 support.
BoE rate decision is a focus today. The central bank is expected keep benchmark interest rate unchanged at 0.50% and maintain the asset purchase target at GBP 375b. A brief statement is expected and the announcement could be a non-event. Sterling is relatively firm as supported by a string of better than expected PMI data recently. Elsewhere, Australia retail sales rose less than expected by 0.2% mom in December. Swiss will release SECO consumer confidence. Eurozone will release retail PMI and German factory orders. US will release Challenger job cuts, non-farm productivity, jobless claims and trade balance. Canada will release trade balance.