The Greek elections results on Sunday June 17^th have moderately alleviated fears of a Greek exit from the Euro Zone with the pro-bailout parties winning the elections over the radical leftists which had vowed to reverse austerity measures. Following the news, the Euro has appreciated against the US dollar and the positive news has rallied markets across the world. Commodity markets have also shown a bullish trend with both Crude Oil and Brent Crude gaining around 1% on Sunday.

However, the Euro problem is unlikely to subside anytime in the near future. All that the Greek election has guaranteed is a continuation of ECB support for Greek banks, but austerity has proven unpopular and ineffective in increasing Greek productivity which should be the end goal. At the moment, the latest situation just buys more time for the Greeks to sort their economy. Although the Greek Banks have a line of credit from the ECB, deposits have fallen by 25% in April compared to the same period last year. However, as of now, thanks to the election results, an immediate crisis has been avoided and Greece looks to remain in the Euro Zone for now.

Even though the markets have responded positively to the Greek election results all eyes are on the Federal Open Market Committee (FOMC) meeting which is scheduled on June 20^th. The situation in the Euro Zone is important for the Federal Reserve in determining whether to initiate another round of Quantitative Easing or not. The Greek elections results hints to the fact that the Euro Zone is in the process of stabilizing, but much larger problems are emerging concerning Spain and Italy. No one is sure which way the Fed is going to lean, but investors should expect volatility. As of now, investors should expect major volatility in commodities such as Gold, Crude Oil and Copper this week.