German government bonds are opening lower Monday, taking direction from improved risk-appetite following constructive discussions between US President Barack Obama and Congressional leaders on fiscal cliff resolution. However, prices are seen underpinned by continued violence between Israel and Hamas in the Gaza strip and ahead of key event risks this week. Traders will be eying eurogroup meeting Tuesday on whether decision is made to extend the next tranche of Greek aid is one such – an extension of last week’s meeting, which so spectacularly failed to reach an accord and left the eurogroup and IMF at loggerheads over whether to give Greece more time to achieve its long-term fiscal goals. More thorny and potentially explosive will be Thursday’s EU summit in Brussels when a long-term EU budget deal is set to be debated. In terms of central bankers, Fed Lacker speaks on monetary policy in New York Tuesday and Federal Reserve Chairman Ben Bernanke will speak to the Economic Club of New York Tuesday. In the ECB — Coeure, Praet, Asmussen are all due to speak this week.
EasyForexNews Research Team