Friday, May 22, 2015

Maybank FX Insight: EURASEAN - Upside Potential - 22 May 2015



EUR/ASEAN:  Upside Potential

*        Greece is now facing a bigger round of crunch time in Jun-Jul. It does not have sufficient funds to meet its debt repayment obligation and is urgently in need to secure the disbursement of the remaining EUR7.2bn of its bailout program. But this has hit a roadblock as ongoing negotiations between Greece and the institutions (IMF, ECB, EU) has yet to find common ground and time is running out.
*         Worries over a Grexit could drive up FX volatility and push the EURUSD, EUR/ASEAN lower but we believe this is likely to be short-lived as medium-term factors such as current account surplus, BBoP surplus and steady portfolio inflows could help the EUR regain strength over time.  

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