Greece Archives - Page 6 of 16

Another Day, Another Greek Debt Payment is Due

Greece is back in the news (has it ever left?) with a new debt payment looming and the ruling Syriza Party increasingly marked by internal tensions. The call from some in the party to “rupture now with the lenders” is in response to new rounds of payments due to service the loans absorbed by the Troika of the IMF, European Central Bank and European Commission. It is clear that even if the Greek government could cobble together the current instalment, the next debt payment, due at the end of June, cannot be met.

Greece is Running out of Options and Time

The US dollar, which traded heavily throughout last week, turned better bid today. However, with no significant data, and the renewed pressure on European bonds, the greenback’s firmer tone looks fragile.

Core, European bond yields are 3-4 bp higher, including German bunds. Peripheral bonds yields are up 8-11 bp, with Greek 10-year yields up 25 bp.

Greece Falls Back Into Recession, Bailout Payments Questionable

Greece has notoriously struggled economically since the global economy declined in 2008. To get struggling European nations back on their feet, the European Central Bank created a bailout program, which Greece eagerly accepted. Unfortunately, as each payment has loomed, Greece has struggled to make repayment. Now, a report of Greece’s first quarter economic performance indicates that it fell back into recession, adding pressure to the struggling nation to reach an agreement with its creditors over its upcoming bailout payments.

Greece and the EU: Winners and Losers, Successes and Failures

Concerns over Greece’s ability to pay the debt it owes to the European Commission, European Central Bank and IMF continue unabated. While a great deal of coverage is given to Greece’s ability to meet the conditions set by its creditors, there is another underlying dynamic of the crisis – who is responsible for it and who it is affecting.

What if a ‘Grexit’ Becomes a Self-fulfilling Prophecy?

As Greece moves from one repayment deadline to another, you can be forgiven for thinking that the country’s main daily challenge is finding the money to pay its public sector workers and meet its debt servicing obligations. While this remains an important challenge, the greatest risk for Greece emanates from the deteriorating liquidity situation of its banks. It is precisely this risk, which could unintentionally trigger the nightmare scenario of a ‘Grexit’. This is the accident that all of the key players in the unfolding Greek drama are working hard to avoid.

IMF Missteps and Mixed Priorities are Costing Greece

When the European phase of the debt crisis erupted, involving the IMF was controversial. However, its money, expertise, and credibility carried the day. It became integral to the aid efforts within the monetary union. It has reportedly signaled it does not want to participate in additional efforts to assist Greece.

Is it Cheaper to Keep Greece in the EU than to Kick it Out?

The change in the Greek negotiating team appears to have helped reinvigorate the talks with the official creditors. However, insufficient progress has been made that would allow a resumption of aid payments. Aid has been cut off since the middle of last year, six months before Syriza’s election.

The official creditors have three demands for conditions for resuming assistance. The Greek government’s proposals must be 1) fiscally sustainable, 2) facilitate financial sector stability, and 3) not undermine competitiveness.

ECB Set to Give Greece Emergency Cash

The ECB is set to announce it will provide emergency lending to Greece even as both continue negotiations on a long-term agreement over the Mediterranean nation’s debt crisis.

The ECB governing council has already increased its cap on lending to Greece, most recently by 1.5 billion euros, or about $1.6 billion, after the Country neared its limit for cash injections. The ECB currently has a limit of 75.5 billion euros, or about $83 billion.

Greek Negotiating Team Personnel Changes are the Latest Act

The Eurogroup meeting before the weekend was particularly acrimonious. Greek Finance Minister Varoufakis was isolated and demonized. After intensifying their criticism of Varoufakis in the closed meeting, according to reporters, several carried their battle to the media.

Greece’s Financial Tragedy Gets More…Tragic?

They held the umpteenth European meeting to discuss Greece and for the umpteenth time, European finance ministers say no. No, they will not provide Greece with the funds to service its debt that they hold (the remainder is largely in the IMF and ECB’s hands).

While there is clearly a greater antagonism between this government and its predecessor, it did not begin with its election. The official creditors have cut Greece off since the middle of 2014. Indeed, that act may have led to Syriza’s election in the first place six months later.