After much anticipation, the Greek people have spoken with official estimates released by the Interior Ministry showing the pro-euro New Democracy Party have won in a narrow victory against the anti-austerity Syriza party. With no single party receiving the outright majority vote of at least 151 seats, the mandate will now fall on the New Democracy party to form a coalition government, something that is expected to be achieved alongside front-runner Pasok which has previously been supportive of austerity measures in exchange for financial aid. Interior Ministry Projections suggest the New Democracy party alongside Pasok will successfully form a coalition government with 161 seats. With only around 60 percent of the votes counted, we've seen a degree of restraint across risk currencies in early trade with the Euro's initial bounce above $US1.27-figure now paring gains alongside the Australian dollar which briefly popped above 101 US cents earlier. At the time of writing the Euro is at $US1.2695 and Aussie dollar is buying 100.9 US cents. Although a sense of closure to Greece's political turmoil will provide a degree of relief, it's likely to be short-lived as relief subsides with investors refocusing their attention on the greater challenges ahead with southern European economies still well and truly in the firing line.

Apart from the obvious headline risk from southern Europe, the week ahead will see the health of the U.S housing sector under the microscope with housing starts, building permits and existing home sales on the docket. The highlight of the week will be Wednesday's FOMC rate decision which will see interest rates remain at 25bps and the Fed maintain their 'exceptionally low federal funds rate through to 2014' mantra. U.S stimulus expectations underpinned gains across the risk spectrum last week, with the recent string of less-than-inspiring economic feedback further supporting the argument the Federal Reserve may soon embark on another round of quantitative easing. Although it's apparent the recent macroeconomic downturn and subdued inflation environment is supportive of the stimulus argument, we remain doubtful the Federal Reserve will embark on such policy initiatives at this week's FOMC meeting. The Philadelphia Fed manufacturing Index will also be of considerable interest later in the week.

Headlining local event risk this week will be Tuesday's RBA minutes for June which saw Stevens and Co cut benchmark interest rates by 25bps. The ensuing statement showed moderate domestic growth, ongoing economic turmoil abroad amid subdued inflation outlook afforded scope for a more accommodative stance of monetary policy. Despite the RBA's recent policy easing initiatives, recent feedback from Glenn Stevens has taken a realistic tone suggesting a need for local industry to adapt to changes in global conditions with emphasis on the importance of business productivity improvement, particularly those sectors struggling under the weight of a high Australian dollar.

Other potential market moving themes this week include the G20 meeting in Mexico, however the major headline risk is likely to come from individual discussions between key European leaders headed up by Germany's Angela Merkel as they seek to build a consensus on the right course of action to stem Europe's decline.