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The Currency Traders Don’t Care About Greece

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Currency traders have grown tired of Greece’s Sisyphus routine.

For those who are unfamiliar with Greek mythology, Sisyphus was a king who was condemned to repeatedly push a boulder up a hill, only to have it roll back to the bottom every time he neared the top. He was condemned to do this over and over again, for eternity.

The analogy to the negotiations between Greece and its creditors is easy to spot.

The Wall Street Journal reported on Thursday that International Monetary Fund officials, frustrated by a lack of progress, abruptly ended negotiations with their Greek counterparts in Brussels. How did the euro react?

It didn’t.

The shared currency barely reacted when the news broke at 10:30 a.m. Eastern.

Greece has had little impact on the euro-dollar trade in recent months. Instead, strategists say, European bond yields have been the guiding force behind the euro-dollar trade.

Currency pairs are heavily influenced by fluctuations in sovereign bond yields, and over the pastfew months, the German bund appears to be driving trade in both Treasurys, and by extension, the euro-dollar pair.

Market Watch

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Craig Erlam

Craig Erlam

Senior Currency Analyst at OANDA
Based in London, England, Craig Erlam joined OANDA in 2015 as a Market Analyst. With more than five years' experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while conducting macroeconomic commentary. He has been published by The Financial Times, Reuters, the Wall Street Journal and The Telegraph, and he also appears regularly as a guest commentator on networks including Sky News, Bloomberg, CNBC and BBC. Craig holds a full membership to the Society of Technical Analysts and he is recognized as a Certified Financial Technician by the International Federation of Technical Analysts.
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