recently Greece, the success or failure of the negotiations “have been regarded as the key event of the debt crisis around Europe. Commence the second round of consultations, while the Greek government and international creditors, the former was indecisive on the issue of deficit reduction, trade unions, and even called for large-scale strike. The euro zone leadership endless angry, because of the Greek political stability and the orderly introduction of fiscal austerity program is a prerequisite for the International Monetary Fund (IMF) and the second tranche of EU rescue gold.
Monday, the euro zone leadership to continue to put pressure on Greece, and that “the little time left. Prior to that, because Greece did not before Monday’s deadline for the austerity program to respond to the negotiations held postponed to Tuesday. The same day, the Government of France and Germany suggested that the euro zone officials to establish an escrow account to receive new aid funds, rather than all assistance funds provided directly to Greece. Greek impasse languished in the market trend on Tuesday the European morning, the major indexes fell slightly, the euro fell slightly against the U.S. dollar.
tripartite negotiations again postponed
Greek political leaders is not yet on how to cut spending to reach agreement, the original meeting date was postponed to Tuesday.
Prior to this, the leadership of the EU and the IMF have agreed in the end of October last year to 130 billion euros, the second round of bailout funds to Greece. At the same time, the Greek government with the private sector creditors 100 billion euros of debt write-down of program negotiations.
“save the country, stay in the euro area means that the great sacrifice that if the talks fail, the plan finished, bankrupt the country, will mean greater expense.”
Greek Finance Minister Venizelos said Greece various political parties The leaders are to prepare for general elections in April this year, they are unwilling to accept another highly unpopular programs, including pay cuts, pension reduction, layoffs and more stringent tax.
debt problems in Greece is facing a severe situation in the country need to pay € 14.5 billion in maturing debt on March 20. EU officials said the overall plan must be in before February 15 with the Greek government to reach agreement, and received the approval of the euro zone, European Central Bank and the IMF, so as to catch the timely completion of the debt before the maturity of the debt on March 20 mutual change the complexity of legal procedures. IMF chief economist Olivier Blanchard said on Monday that, it seems the bonds in the hands of the Greek private creditors “written down” rate would be “very large”.
the De Fati proposed regulatory assistance
Greece delay the attitude of Germany and France, was very angry. Monday in a joint press conference with French President Nicolas Sarkozy, German Chancellor Angela Merkel said, “I do not understand why you need more days, not much time left.” Sarkozy said, without reform financial assistance. But he also said, “allow Greek bankruptcy is not the policy options.
Germany and France two heads of state proposed for Greece to set up a separate account to pay interest on the debt, to ensure that the creditor is getting paid. “We hope that Greece will continue to stay in the euro area,” Merkel said, “I would like to once again make it clear that, if not the implementation of the tripartite delegation’s proposal, might not reach an agreement, the situation is obviously the need to act quickly,” she also said that it relates to the entire euro zone.
According to this new proposed program, any new introduction of the Greek aid program, you must specify the part of the funds to pay the rest of the Greek bondholders, which makes the lender has to stop the power of the Greek aid, while preventing the emergence of a chaotic breach of contract, renewed financial market panic. The new fund will ensure that the bondholders are being paid at the same time, if Greece failed to meet the stringent new demands for reform, the remaining funds will be used to support the Greek government-run are retained.
Europe shares early lackluster
In addition to pressure from Germany and the French leadership, the EU executive committee Klose said the foreign media, the euro area can continue to safely survive, even if Greece was forced to withdraw from the euro zone. However, the President of Euro Group Juncker said on Tuesday, can not force Greece to withdraw from the euro area, and believe that Greece will perform their duties.
local time Tuesday, the Greek government once again bond auction, sold for € 812.5 million six-month bonds, the average rate of return than the previous auction declined. However, the same day the European morning trading, the market is almost flat opening, followed by a slight decline. 19:00 GMT Tuesday, the stock market decline in West Germany, France 0.3% to 0.6%. The euro against the dollar at $ 1.3120, down 0.06 percent.
bad news and good news obviously asymmetric impact on the market, bad news may cause serious consequences, “analysts at Numis Securities, said,” but we believe may be in a very short period of time there is a good result, so we tend to keep the risk preferences in our portfolio. “
Exchange of Forex, chief currency strategist Brian Dolan said that the development impact of the European debt to market sentiment, investors are waiting for the outcome of the negotiations of Greece.
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