EUR strength abated on Monday as the relief...>

FOREX: EUR strength abated on Monday as the relief rally reversed with fresh

Italian elections (as soon as this year) looing even more likely. Former IMF-er

Cottarelli's appointment as Italian PM-designate by the President needs to

survive a confidence vote, which will be tough going as M5S/League coalition

holds a majority if they vote together. If Cottarelli does not pass the

confidence motion then an election could come "after August." Spain is also

presenting its own political issues with PM Rajoy set to face a confidence

motion on Friday. EURUSD printed YtD lows of 1.1608.

- Price action was thin & erratic owing to the market holidays, with both the US

& UK out, which meant that the EUR crosses remained front and centre.

- Fed non-voter Bullard will speak in Asia-Pacific hours, with a slew of ECB

speakers including Mersch, Lautenschlaeger, Villeroy, Coeure & Nowotny due later

in the day.

- Singapore will observe a national holiday.