10 Mar 2015
Greek tensions have begun to surface again - ANZ
FXStreet (Bali) - Greek tensions have begun to surface again, notes the Economics Team at ANZ, adding that at least for now, broader global markets are taking this increased tension in its stride.
Key Quotes
"Two weeks ago the provisional agreement with creditors appeared to buy Greece some time in averting imminent default. It saw global markets shift their focus to other issues like ECB easing, a string of better economic data and the timing of Fed monetary policy stimulus withdrawal. Now, however, Greek tensions have begun to surface again."
"Negotiations between Euro area and Greek officials over Greece’s reform proposals (which are required for approval to ensure additional fund disbursement) have apparently hit a snag."
"The disagreements are familiar. Euro area creditors are demanding more stringent and structural reforms that the new Greek government, at least for now, is unwilling to accept."
"Overnight this culminated in some stern words from Dutch Finance Minister Dijsselbloem, who heads the finance ministers group, stating that the reforms proposed were “far from complete” and “little progress has been made”.
"Adding to tensions were reports over the weekend of a possible Greek referendum if the deadlock wasn’t broken. Greek assets fared poorly overnight. The equity market was down sharply, and bond yields spiked. But at least for now, broader global markets are taking this increased tension in its stride. Perhaps this was due to the fact the ECB’s much awaited sovereign bond purchase programme got underway and the liquidity sugar pill is keeping many happy for now."
Key Quotes
"Two weeks ago the provisional agreement with creditors appeared to buy Greece some time in averting imminent default. It saw global markets shift their focus to other issues like ECB easing, a string of better economic data and the timing of Fed monetary policy stimulus withdrawal. Now, however, Greek tensions have begun to surface again."
"Negotiations between Euro area and Greek officials over Greece’s reform proposals (which are required for approval to ensure additional fund disbursement) have apparently hit a snag."
"The disagreements are familiar. Euro area creditors are demanding more stringent and structural reforms that the new Greek government, at least for now, is unwilling to accept."
"Overnight this culminated in some stern words from Dutch Finance Minister Dijsselbloem, who heads the finance ministers group, stating that the reforms proposed were “far from complete” and “little progress has been made”.
"Adding to tensions were reports over the weekend of a possible Greek referendum if the deadlock wasn’t broken. Greek assets fared poorly overnight. The equity market was down sharply, and bond yields spiked. But at least for now, broader global markets are taking this increased tension in its stride. Perhaps this was due to the fact the ECB’s much awaited sovereign bond purchase programme got underway and the liquidity sugar pill is keeping many happy for now."