EUR - Greece situation worsens, inflation to remain low, but PMIs encouraging

Despite recent reported progress between Greece and its creditors, a significant gap remains. While an agreement without a political disruption is still possible, this is becoming increasingly unlikely. 

An agreement with some form of a political disruption seems most likely and should weigh on the EUR.

In terms of data this week, the consensus expect euro area final HICP headline and core inflation (Tuesday) to be confirmed in April at 0.0% and +0.6%, respectively. 

The euro area flash composite PMI (Thursday) is likely to edge down in May to 53.6 (consensus: 53.9), due to lower manufacturing confidence. Services PMI should hold firm at 54.0 (consensus: 53.9).