Investors remained cautious ahead of the G-20 summit. The hottest topic for the meeting will probably be the Greek situation. By calling for a referendum, Greek's action raised question about whether it should stay in the Eurozone. Moreover, global financial leaders will discuss about China's RMB appreciation. Another important event for today is the ECB meeting although no change in monetary policy is expected.
While the Greek Prime Minister George Papandreou the referendum is for the bailout plan instead of the membership, the unilateral decisions has raised criticism and doubt about the country's remaining in the Eurozone. T German Chancellor Angela Merkel said the referendum will 'revolve around nothing less than the question: does Greece want to stay in the euro, yes or no?' while the French President Nicolas Sarkozy said the Greek government will not get 'a single cent' if it rejects the plan. Meanwhile, the 6th tranche of the financial assistance to Greece will be withheld until December, after the referendum is completed.
The ECB meeting today will be led by Mario Draghi, the new president of the central bank. Yet, not much change is expected in both the monetary policy and the stance that the ECB is not a bailout organization for debt-ridden governments.
Appreciation in RMB has been an issue in the world's economic and even political stage. The G-20 is expected to debate whether to include in the joint communiqué a reference to urge China to allow more flexibility in RMB so as to help ease tensions in global economic imbalance. Last month, the communiqué omitted reference to the RMB and was described Chinese Deputy Finance Minister Zhu Guangyao as 'comprehensive and balanced'.