httpvh://www.youtube.com/watch?v=5DY2T2pA1Vg

A strong Greek debt auction allowed the euro to stay at its recently elevated levels yesterday but fears persist over the long-term sustainability of plans. The Greeks issued a one year treasury bill valued at EUR1.56bn which was well covered although the yield is still fairly exorbitant at 4.85%. The single currency sold off in the aftermath but rebounded well in the afternoon session although global equity markets continued to push further into the red.

Sterling was boosted by trade deficit figures which showed that exporters are finally benefiting from the weak pound. Exports jumped by over 9% in February as the January snowfall problems allowed easier business conditions. A separate survey showed that manufacturers are increasingly benefiting from the weak pound with now over 90% of manufacturing companies in the UK exporting and, of those, more than 40% are seeing over half of their revenues made up of exports. Whether this will see further ‘soft weakening’ in the coming months to facilitate this further remains to be seen,

Strange noises are coming from the City. Normally the Conservative party are seen as the most pro-banking party however Credit Suisse has issued a note this morning saying that Labour would be better for the banks in a post-election Britain than the Tories. This apparently boils down to regulation. Or maybe it’s actually a cunning Conservative party plan to tie Gordon to the City at a time when he is focused on regaining the Labour party base. Cynical? Me?

Data today consists of mainly US releases with retail sales at 13.30 the main attention grabber. We also have US inflation at the same time. We expect these releases to continue to weaken the US dollar.