ForexLive European Wrap: Merkel blinks

EU summit statement Merkel: Leaders reached important decisions last night Italy and Spain get their way at EU summit - Der Speigel Merkel faces backlash in Bundestag. SPD has called special meeting of budget committee to explain "180 degree turn" on ESM.  Merkel set to speak at 5pm in the Bundestag ECB's Draghi: EU summit has produced long-term commitment and tangible short-term measures Euro zone officials: Flexible use of EFSF/ESM to stabilise markets decided by euro leaders means both primary and secondary bond market internetions are possible. Choice of EFSF/ESM instrument to be made when country applies for euro zone support, to best suit needs Germany press: Over 12,000 lawsuits against ESM, fiscal compact - MNI German banking association; Supports joint supervision for banks getting ESM aid German official:  No direct recapitalization without common bank oversight Finland PM:  Will ask for collateral for use of EFSF for Spain bank rescue BOE's Financial Policy Commitee: UK financial stability outlook has deteriorated BOE's King: Uncertainty and tighter credit conditions have acted as strong headwinds to UK recovery China's PBOC: Reiterates will fine tune monetary policy German prelim May retail sales -0.3% m/m, -1.1% y/y, weaker than Reuter's median forecasts flat, +1.0% respectively French May consumer spending +0.4% m/m, +0.6% y/y, stronger than median forecasts of flat, +0.1% respectively Swiis June KOF leading indicator 1.16,  stronger than median forecasts 0.78 Eurozone June CPI estimate 2.4% y/y, as expected Full EU summit statement (in all its conditional wishy-washy glory) - Zerohedge Forex markets have been eerily quiet given the overnight developments from the EU summit. EUR/USD very marginally firmer at 1.2590 from the 1.2575 which greeted me first thing.  Early rally over 1.2600 was fleeting.  ACB selling notable above said level.  From there we drifted lower, but noted buy orders at 1.2550/60 held the downside (session low 1.2553) Talk now of sell stops gathered below 1.2550.