Lee Hardman, Currency Analyst at Bank of Tokyo-Mitsubishi UFJ, comments that with lack of compromise from either side (Greece, ECB), concern regarding a possible Greek default and exit are increasing.
Key Quotes
“The Greek bond market is increasingly pricing in a more unfavourable outcome from the ongoing negotiations between the new Greek government and its international creditors. It follows a defiant pledge from Greek Prime Minister Tsipras at the weekend to end the current bail out agreement which expires at the end of this month.”
“German Finance Minister Schauble has since stated that he does not understand how Greece plans to deal with its problems, and agreed with ECB President Draghi that the Greek government first needs the bailout if it wants some form of bridge financing.”
“The lack of compromise on both sides is heightening investor concern that an agreement may not be reached thereby increasing the risk of a Greek default and exit from the euro-zone.”
“Euro-zone finance ministers are scheduled to meet tomorrow for an emergency meeting of the Eurogroup, which will be followed by an EU Leaders Summit on Thursday.”
“The outcome from negotiations will be closely watched in the coming days for any signs of a potential compromise agreement. Investors are likely to become increasingly nervous of an adverse outcome if there are no positive developments.”
“Former Fed Chairman Greenspan grabbed media and market attention yesterday after stating that “I think it’s just a matter of time before everyone recognizes that parting is the best strategy”.”
“The negative impact on the euro from developments in Greece has been limited so far as has spill over effects to the euro-zone as a whole. However, if Greece were to leave the euro-zone it would materially increase downside risks for the euro in the near-term and threaten financial stability within the euro-zone.”
Key Quotes
“The Greek bond market is increasingly pricing in a more unfavourable outcome from the ongoing negotiations between the new Greek government and its international creditors. It follows a defiant pledge from Greek Prime Minister Tsipras at the weekend to end the current bail out agreement which expires at the end of this month.”
“German Finance Minister Schauble has since stated that he does not understand how Greece plans to deal with its problems, and agreed with ECB President Draghi that the Greek government first needs the bailout if it wants some form of bridge financing.”
“The lack of compromise on both sides is heightening investor concern that an agreement may not be reached thereby increasing the risk of a Greek default and exit from the euro-zone.”
“Euro-zone finance ministers are scheduled to meet tomorrow for an emergency meeting of the Eurogroup, which will be followed by an EU Leaders Summit on Thursday.”
“The outcome from negotiations will be closely watched in the coming days for any signs of a potential compromise agreement. Investors are likely to become increasingly nervous of an adverse outcome if there are no positive developments.”
“Former Fed Chairman Greenspan grabbed media and market attention yesterday after stating that “I think it’s just a matter of time before everyone recognizes that parting is the best strategy”.”
“The negative impact on the euro from developments in Greece has been limited so far as has spill over effects to the euro-zone as a whole. However, if Greece were to leave the euro-zone it would materially increase downside risks for the euro in the near-term and threaten financial stability within the euro-zone.”
