Greece

A very dangerous war of words

Symptomatic of the huge political and financial stakes involved in the Greek debt impasse is the war of words between politicians in Greece and northern Europe. At such an incredibly sensitive and critical time, a verbal escalation is understandable on the one hand, but also very dangerous on the other.
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16/02/2012 @ 12:43 GMT

Greenback gains from Greek grief

Noticeable over the past week has been the increasing flight back into the dollar as concerns over Greece mount once more. With northern Europe, especially Germany, prepared to play hard-ball with Greek politicians, there is a genuine fear that time is running out to make a binding restructuring-deal before the next bond repayment on March 20th. The dollar index has climbed 1.5% since the middle of last week, and is now back above both the 200d and 50d moving average.
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16/02/2012 @ 11:04 GMT

Watching and waiting

China’s politicised declaration that it would help Europe failed to have much sustained impact on market sentiment yesterday, with both traders and investors instead focused principally on the latest machinations in Greece (see below). Northern Europe has clearly lost confidence in Greek promises, while politicians in the latter calculate that the former will ultimately not be prepared to cut them loose.
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16/02/2012 @ 08:23 GMT

Greece goes from bad to abominable

The Greek debt debacle increasingly looks like a game of Russian roulette between politicians and European leaders. Europe threatens no bailout without additional austerity, Greek politicians threaten default but sign off on austerity measures anyway and then signal their intent to renege almost immediately. And now Europe is contemplating delaying the second bailout package until after the next Greek general elections (while at the same time giving Greece enough money to avert a default).
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15/02/2012 @ 15:10 GMT

Euro shrugs off Moody’s blues

Yet another example yesterday of the single currency failing to respond negatively to bad news - another sign that the quality of the price action is very different these days. Despite Moody’s adverse pronouncement on the outlook for eurozone sovereign debt ratings, the euro preferred to focus on other developments. Spanish and Dutch auctions went well and the German ZEW economic sentiment index for February was significantly above expectations.
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15/02/2012 @ 08:37 GMT

Athens burning a hole in Europe’s pocket

Parliamentarians in Greece signed an austerity bill into law early yesterday, but this has not prevented Greek politicians from rapid back-pedalling. Critically, leader of the New Democracy Party, Antonis Samaras - also the leader in the polls for the upcoming election - has said that this deal will last for barely two months and that it should be renegotiated and altered thereafter. For the troika, which meets tomorrow to discuss whether to agree to the latest Greek bailout, this is dreadful news.
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14/02/2012 @ 08:21 GMT

The price of austerity

On the face of it, the vote to pass the latest austerity measures in Greece passed comfortably, 199 votes in favour with 74 against. But the political and social price has been high. Several cabinet ministers have resigned and violent protests have spread across the country. But as always, it’s a question of implementation of the measures which run to over 50 pages in the memorandum of understanding. We’re not home and dry yet however, with EU Finance Ministers set to meet on Wednesday to give final approval, together with the finalisation of the private sector involvement deal.
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13/02/2012 @ 08:21 GMT

Every reason to feel nervous

So here’s the situation. Greece is now having to vote on the austerity measure it finally agreed to yesterday, agree to and get this done by Wednesday. Meanwhile, the private sector involvement (PSI) deal is meant to be very near completion, something which we have heard many times before. With a 48-hour strike now in train, it’s going to be a tumultuous weekend in Greece. If Greece is still in the euro and/or has not seen a distressed default by the end of March, it would be the more remarkable turn of events.
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10/02/2012 @ 13:52 GMT

Greek deal optimism a triumph of hope over experience

Optimism that all of those lengthy meetings in Athens produced the outline of a deal has provided the single currency with some fresh impetus in the last few days, the euro reaching a two-month high above 1.33 yesterday. Over the course of yesterday, it was confirmed that there was a memorandum of understanding between the leaders of the major political parties in Greece and the troika. Greek politicians have apparently agreed to the 22% reduction in the minimum wage demanded by the troika.
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10/02/2012 @ 08:48 GMT

Greek deal optimism a triumph of hope over experience

Optimism that yesterday’s lengthy meetings in Athens produced the outline of a deal has provided the single currency with some fresh impetus overnight, the euro reaching a two-month high above 1.33. According to a Greek aide who spoke to the Guardian, Greek Finance Minister Venizelos would have the “finalised text of the agreement in his hands” by the time he boarded a plane this morning headed for a Eurogroup meeting in Brussels.
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09/02/2012 @ 08:54 GMT

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