Flash Eurozone PMI Composite Output Index at 52.9 (53.0 in April) which is 16-month low.
Flash Eurozone Services PMI Activity Index unchanged at 53.1 (53.1 in April).
Flash Eurozone Manufacturing PMI(3) at 51.5 (51.7 in April) which is 3-month low.
Longer-term we are correcting the downtrend from 1.60 and 1.40, having developed a base at 1.0450.
25-delta risk reversals show the difference in volatility, and therefore price, between puts and calls on the most liquid out-of-the-money (OTM) options quoted on the OTC market.
While you can make out all euro crosses except EURGBP flashing negative values indicate puts are more expensive than calls which is indirectly implies that the downside protection is relatively more expensive.
Focus in the euro area overnight was on Greece, where the Parliament passed an omnibus bill of fiscal reform measures including further tax increases, the establishment of a process for determining further public spending cuts in the event of budgetary shortfalls, and the creation of a new independent privatisation agency to which certain state assets would be transferred.
As such, tomorrow’s Eurogroup meeting will see finance ministers consider disbursement of the latest tranche of funds to enable the Greek authorities to meet its payments of about €3.5bn due by end-July.
In addition, the ministers will discuss certain options to enhance the sustainability of Greece’s debt, including longer grace and repayment periods, the transfer of IMF loans to the ESM, the transfer of Eurosystem profits to the Greek authorities, and other measures to reduce the sovereign’s liabilities in NPV terms.
EURUSD was down 0.17% at 1.1203, re-approaching last Thursday’s two-month lows of 1.1179. The euro hit one-week lows against the yen, with EURJPY down 0.65% at 122.83.
The material has been provided by InstaForex Company – www.instaforex.com