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Forex - EUR/USD weekly outlook: June 29 - July 3

Published 06/28/2015, 11:01 AM
Updated 06/28/2015, 03:01 PM
© Reuters.  Greece to hold referendum on bailout extension as default looms
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Investing.com - The euro slid lower against the dollar and the other major currencies on Friday pressured lower amid uncertainty as negotiations between Greece and its international lenders continued.

EUR/USD was down 0.35% to 1.1164 in late trade, and ended the week with losses of 1.74%.

The single currency was also lower against the traditional safe haven yen and Swiss franc, with EUR/JPY at 138.32 and EUR/CHF down 0.6% to 1.0429.

Sentiment on the single currency was hit by concerns over whether Greece could reach an agreement with its international lenders in time to avert a default.

Greece’s bailout is due to expire on Tuesday, the same day that Athens is due to repay €1.6 billion to the International Monetary Fund, but without a rescue package in place Greece will almost certainly default.

In the week ahead, investors will be focusing on developments in Greece after Prime Minister Alexis Tsipras abandoned negotiations with creditors on Saturday and called for a referendum to be held on July 5 on the terms proposed by lenders for extending the country’s bailout program.

European finance ministers refused a request from the Greek government to extend the bailout program until after the referendum.

The European Central Bank said Sunday it will continue providing emergency liquidity assistance to Greece’s banks, but capped emergency funding at current levels. The ECB said it was monitoring the situation and stood ready "to reconsider its decision."

Greek officials were to hold talks later Sunday to discuss measures to avert a mounting crisis in the banking sector after deposit outflows accelerated over the weekend.

Later in the week market participants will be turning their attention to the latest U.S. employment report, due for release one day ahead of schedule on Thursday, for signs of improvement in the labor market, which the Federal Reserve has said is a key factor in deciding when to start hiking interest rates.

Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.

Monday, June 29

In the euro zone, Germany and Spain are to release preliminary data on consumer inflation.

Later Monday, the U.S. is to publish a report on pending home sales.

Tuesday, June 30

In the euro area, Germany is to release data on retail sales and the change in the number of people employed.

The euro zone is to release preliminary data on consumer inflation and a report on the unemployment rate.

The U.S. is to release data on consumer confidence.

Wednesday, July 1

The U.S. is to release a report on ADP nonfarm payrolls and later in the day the Institute of Supply Management is to release data on manufacturing activity.

Thursday, July 2

The U.S. is to release the closely watched nonfarm payrolls report, and data on wage growth one day early, ahead of the Independence Day holiday. U.S. data on initial jobless claims and factory orders is also due for release.

Friday, July 3

The euro zone is to round up the week with a report on retail sales.

U.S. markets are to remain closed for the July 4th holiday.

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