MACRO: Ireland and Portugal get extensions on maturities 
Mads Koefoed, Macro Strategist at Saxo:
“The Cyprus situation has stolen the headlines these last few days – and not without merit. However, as everybody scrambles to form an opinion about Cyprus, news during the weekend regarding two other euro members slipped below the radar. Ireland and Portugal, which applied for bailouts in November 2010 and April 2011, respectively, have been among the most vigorous reformists. In return, the market has priced the two countries’ yields lower with the Irish 10-year at 4.14 percent while the Portuguese equivalent stands at 6.16 percent. This should be compared to peaks of 14.1 percent and 18.3 percent, respectively. Now the reformist efforts are also paying dividends from their euro area finance colleagues.” Read More
FOREX: Troika of event risks ahead: Cyprus, FOMC and UK budget
John Hardy, Head of FX Strategy at Saxo:
“The Cyprus situation couldn’t have happened at a more “interesting” time for the market, as we also have the FOMC meeting up on Wednesday together with Chancellor Osborne’s heavily anticipated new UK budget on the same day, which will set the tone for the market’s trust in the UK and its currency and whether the country can pull itself out of its current funk – or whether a portion of the sterling shorts have been a mere flipside of the global risk-on trade that has seen enthusiastic buying of risk and selling of the most likely funding currencies, the JPY and the GBP. The psychological line in the sand here for confidence across markets over the next few days has to be 1.3000 in EURUSD.” Read More
COMMODITIES: Limited Cyprus impact in commodities
Ole Hansen, Head of Commodity Strategy at Saxo:
“The nervousness created about uncertainty related to Cyprus has triggered a predominantly negative beginning to the week for commodities, especially those that are growth dependent such as crude oil and copper. The latter is currently the biggest loser on the day, down by 2.5 percent. At the other end of the scale this uncertainty has created some support for precious metals, especially gold. The overall impact considering the media frenzy has so far been relatively subdued with a wait-and-see approach being adopted.Headwind, however, is being created by a stronger dollar with most of the positive gold action having been seen in XAUEUR while this week’s FOMC meeting will create some nervousness considering the continued pick-up in US activity.” Read More
This material (whether or not it states any opinions) is for general information purposes only, and does not take into account your personal circumstances or objectives. This material may refer to past performance and you should note that past performance is not necessarily a reliable indicator of future performance. Nothing in this material is (or should be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by Saxo Capital Markets UK Limited or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.
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