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a bailout hurdle.

The euro rose to US$1,4531 from US$1,4188. It strengthened by 2,9 percent to trade to 117,42 Yen from 114,13.The Yen fell 0,5 percent against the dollar to 80.83 from 80.43.
The risk of a default has really fallen significantly and Greece is moving in the right direction prompting traders to reduce their safe-haven bets and buying the euro and other currencies,
The market wants progress and it is good that it is getting this from the Eurozone.

This week sees the European Central Bank, Bank of England and the Reserve Bank of Australia meeting in their respective countries to discuss possible rate changes.
The ECB meeting will be held on July 7 to discuss a possible rate hike to curb inflation and this could see the US dollar depreciate even further and the euro accelerating against the dollar.
I am sure it will beat the 1,46 mark. The dollar index which tracks the movement of the dollar against the 16 trading partners including the euro and the pound fell 1,8 percent to 74,298 from 75,665.

In the UK, economic recovery is faltering and that has since reduced the scope of interest rate hiking from the Bank of England.
The pound has been regarded as a second worst performer after the dollar among the basket of its six trading partners.
UK confidence has fallen and the manufacturing growth has unexpectedly slowed and that has seen the pound decline.

The pound could further decline if the Bank of England decides to keep rates unchanged at 0,5 percent.
The euro was trading at 0,8960 against the pound. This means that an investor buying the euro against pound at 0,8960 would make a profit at 0,9200.
The pound added 1,2 percent to the Yen and was trading at 129,87. The pound gained against the dollar to trade at 1,6069 from 1,5959.

The Reserve Bank of Australia is also set to keep rates unchanged. The Swiss franc declined against the euro on a shift by investors that the euro zone short term risks could be abated.
The Swiss was quite a good safe-haven currency, especially if one wanted to flee the euro because of its short-term risks.
The market will continue to see a weaker Swiss franc as long as there are no more event risk in the euro zone.

The carry trade of selling dollars to buy the currencies of Norway, Australia, Canada, New Zealand and South Africa tripled last week as investors’ appetite for higher-yielding assets increased.
The rand rallied against the dollar, boosted by demand from investors for high-yielding assets on optimism Europe may avert a Greek default.
South Africa’s currency added 0,2 percent to trade at US$6,7476 from US$6,7715.

The rand also appreciated against the euro to 9.8055.Commodity prices retreated after China’s purchasing manager index slipped to its lowest levels, signaling that the world’s second biggest economy is cooling as export demand weakened.

China’s manufacturing activity data has been slowing down and that might affect the markets.
That saw the prices for crude oil tumble to US$95,23 per barrel from US$96,20 per barrel.

China and the United States are the world’s largest oil consuming countries and the manufacturing numbers are used as indicators for fuel demand growth.
For me China is where the growth is but with such data it becomes a concern for the global economic growth.

Gold tumbled to a six-week low as Greece progressed in staving off a default, curbing demand for the metal as an investment haven.
The bullion was trading at US$1 494,60 from US$1 501,30. I felt that Gold could be trading at better levels especially in a weaker dollar scenario but other factors came into play like the Chinese and US PMI data bringing the metal to US$1 494,60.

The US market was closed for their July 4th Independence holiday.
For more news updates and comments please contact Prodigy Chinanga 077 2 753 594 or e-mail on [email protected].