GREXIT: "Greece’s exit from the eurozone – is the most likely outcome"

Markets are beginning to write off Greece


Through all the bluster, deadlines and ultimatums, global investors have figured bankrupt Greece and its tight-fisted creditors in Europe would work out a deal. A sloppy deal, but at least a way to avoid the worst-case scenario. But now they’re starting to plan for the worst-case scenario — a Greek exit from the eurozone and a return to its former currency, the drachma. Citi, for instance, said in a July 8 research note, “We are changing our view and now believe that Grexit – Greece’s exit from the eurozone – is the most likely outcome.”
Greeks Under the Gun to Produce a Reform Plan to Keep Euro


The continent’s most indebted country has never been closer to leaving the currency after more than six European leaders made clear this is Greece’s last chance. Failure to get a deal could result in the European Central Bank cutting funds to Greek banks, forcing the country to issue IOUs or some other form of exchange to prevent economic collapse. “Greece has to demonstrate a willingness to follow through and table some reforms extremely quickly,” Mujtaba Rahman, an analyst at Eurasia Group, said in a note to clients. Chancellor Angela Merkel, who as head of Europe’s biggest economy carries the most sway, is willing to let Greece go if Germany doesn’t consider its plans credible, according to two government officials familiar with her strategy who asked not to be identified discussing private deliberations.
Comment: Image source

No comments:

Post a Comment

Any anonymous comments with links will be rejected. Please do not comment off-topic