Sterling and euro on low ebb as economic outlook remains fragile

Even though the much-needed Greek bailout package has been granted following lengthy talks between eurozone finance ministers, the euro and sterling remain on a low ebb, as the continent's economic outlook appears fragile.

The conference - which took place in Brussels and did not conclude until the early hours of today (February 21st) - saw a second rescue fund for the stricken nation approved, removing the threat of a dangerous default in March.

However, this funding injection will not solve Greece's economic woes and the euro area - in addition to non-member states such as the UK - is facing heightened levels of economic fragility in the months to come.

The euro's appreciation and depreciation has been tracking the Greek financial saga since the nation hit crisis point in 2009.

Indeed, the Mediterranean nation has been in recession for five years.

The sterling has not been immune to these fiscal woes, with the Greek developments running parallel to the country's domestic financial outlook.

Traders may be biding their time with the pound for the time being until the Bank of England's Monetary Policy Committee (MPC) minutes are released following its next meeting tomorrow.

Earlier this month, the MPC elected for another £50 billion of asset purchases at its meeting in February to try and stimulate the slow-moving economy.

Deputy governor of the Bank of England Charlie Bean is due to give a speech at the Scottish Council for Development this evening - another event that may sway the state of the pound.

At 12:25 GMT, sterling was down 0.2 per cent versus the dollar, with £1 buying nearly $1.6.

The euro was also down 0.2 per cent in trading against the greenback with €1 buying $1.3.

Both currencies were also down versus the yen, with the pound losing 0.2 per cent buying 125.9 yen and the single currency declining 0.2 per cent and equalling 1.05.2 yen.