Broadgate: Market News 7/2
7 February 2012
Yesterday the European Commission stressed Greece with the purpose that they were already late in meeting Brussels demands for a political agreement to reform its economy and cut its debts with a substitute for a new rescue plan.
Greece’s plans of rescue from the troika have hanged in the stability over the earlier period as talks in Athens was unsuccessful to settle an agreement on measures demanded by lenders, which might include a cut in the minimum earnings, reduced pensions and instant layoffs for state employees, while Athens is negotiating with its private creditors demanding to talk them into to agree to a greater haircut on the Greek liability they hold.
It is pursuing that banks, insurers and the European Central Bank (ECB) itself take sufferers loss of about 70%. With no agreement, Greece will not be entertained to receive the €130bn second bailout essential to avoid a messy default. Till March 20 the country need to pay back €14.5bn to Greek bondholders.
Germany and France have told Greece in attendance that there will be no €130bn bailout unless it agrees harsh new serious cuts and reforms, although the European Commission warned the deadline for an agreement has already passed. Greece approved to make further cuts this year equivalent to 1.5 percent of gross domestic product; they have yet to close up gaps over procedures demanded by creditors.
Greek’s PM plans to discuss with the nation’s political leaders to perform additional economic measures needed to protect European Union-led bailout. Greek political leaders will especially meet today to come to a decision whether to agree new austerity measures demanded by the country’s public creditors. The meeting was supposed to be held on yesterday. A 24-hours strike has been called in for today in reaction to the increment of the austerity procedures asked by the troika, required to cover the technique for the next tranche of the rescue package.
In Japan as the ministry attempts to restriction over stubbornly strong yen that is harming the economy, a change in its foreign exchange tactics toward stealth intervention makes it more difficult for investors to forecast its actions and estimate the direction of the dollar-yen exchange rates.
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