FXStreet (Bali) – Following news that the ECB will cuts its credit lines to Greek banks, Greece ordered its banks to remain closed for the coming week to prevent further capital outflows as fear mounts of a possible Grexit.
As Bloomberg reports: “Piraeus Bank SA Chief Executive Officer Anthimos Thomopoulos disclosed the decision to reporters after a meeting of the government’s financial-stability panel on Sunday.”
Banks will stay closed until at least July 5th, when a referendum called by Prime Minister Alexis Tsipras last Friday will take place. On this critical make-or-break reckoning day, the Greek population will have to express their view on whether or not the country should accept a new funding deal with international creditors. As the negotiations stand, the recommendation of the government is for the population to vote ‘No’ to the current conditions being offered.
Reuters is now crossing the wires, noting that the Greek Financial Stability Council recommended a daily cash withdrawal limit of 60 euros as of Tuesday, with ATMs to remain closed Monday. As Reuters expands: “the Fin Stability Council recommends keeping banks closed for the next 6 days. However, for capital control measures to take effect Greek cabinet must approve council recommendations, Presidential decree needed.”
(Market News Provided by FXstreet)