by Brian Miller
UK sterling stands almost unchanged versus the euro today at 1.3475, just a quarter of a cent from its strongest since January 25th 2008, or 7 full years.
The pound remains close to this 7-year high, because several politicians released statements over the weekend highlighting and even increasing the risk that Greece may soon exit the Eurozone.
Euro weakens, as Tsipras rejects bailout
For instance, Greek prime minister Alexis Tsipras, in his first major speech in Greece’s parliament, rejected the austerity policies imposed on Greece during the past few years. Mr. Tsipras said that "After five years of bailout barbarity, our people cannot take any more,” and refused to extend Greece’s €240 bailout, due to expire on February 28th.
Euro declines, as Juncker challenges Greece
Meanwhile, the president of the European Commission Jean-Claude Juncker has said that Greece cannot expect that the rest of Europe will simply accept whatever conditions it proposes. Mr. Juncker told journalists that "Greece should not assume that the overall mood has so changed that the euro zone will adopt Tsipras's government program unconditionally."
Clearly then, this puts Athens and Brussels on a collision course. Neither side seems prepared to compromise, increasing the risk that Greece will eventually exit the Eurozone.
Euro falls, as Greenspan predicts Grexit
What’s more, globally-respected economist and former head of the US Federal Reserve Alan Greenspan gave his two cents over the weekend, arguing that Greece’s exit from the Eurozone is inevitable. Mr. Greenspan said that "Greece will leave the Eurozone. I don't see that it helps Greece to be in the Euro, and I certainly don't see that it helps the rest of the Eurozone.”
With this in mind, the pound remains close to its 7-year high versus the euro today.
