GBP/USD tests resistance at $1.5200

Greek finance minister Yanis Varoufakis finds himself in Germany today trying to add Wolfgang Schauble to his list of new friends. 

A Greek flag
Source: Bloomberg

Greek meetings to guide euro bias

To date all of the quotes attributable to German politicians have given little indication that this will be an easy day of meetings. Greece’s proposal, early in the week, to link its repayments to the pace of recovery of its economy has been given short shrift in Northern Europe.

It is hard to believe that once these meetings are concluded the press statements will give much encouragement to the Greek populous. This will put pressure on the newly elected Greek government to deliver on its promises.

Fresh pressure on the EUR/USD rate almost looks inevitable, and regardless of the mild recovery that EUR/USD has had a retest of the January $1.1097 lows could be on the cards.

GBP/USD above $1.52

The focus of late has rightly been on Europe rather than the UK, and this lack of scrutiny has contributed to the GBP/USD rate once again popping above the $1.52 level. As David Madden stated yesterday, Monday’s weak factory orders set the tone for a softened stance towards the dollar. Yesterday added to that feeling with the ADP non-farm figures coming in below expectations. This gives an indication (albeit unreliable) that Friday's non-farm payroll figures could be on the softer side of estimates.

The bounce in GBP/USD might have a little more legs to it as the 50-day moving average is above the $1.5330 level, and the year highs in GBP/USD are just shy of the $1.5600 region.

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