FXStreet (Barcelona) – The Brown Brothers Harriman Team summarizes the key developments surrounding the Greece debt deal and austerity issue.
Key Quotes
“The Greek financial crisis continues, and Greek stocks are bucking the better European equity performance today. Tomorrow’s Eurogroup meeting has become more important, even though finance ministers have failed to resolve the issue even after Greece changed their negotiating team.”
“Reports suggest that while the US has been critical of the austerity drive in Europe (on sequential grounds –growth first then austerity), Treasury Secretary Lew has spoken with the Greek Prime Minister to add pressure for a compromise.”
“Ultimately, the official creditors are demanding greater austerity from Greece so that they can give the beleaguered, even if not innocent, country the funds that can be used to service its debt to them, the official creditors.”
“We remain struck by the fact that by the EC’s reckoning its demands and Greece’s offer differ by about 2 bln euros (a year). The economic and financial forecasts are hardly precise enough to regard this as anything but a rounding error. Surely a Greek exit would cost the EC directly and indirectly some multiple of this.”
(Market News Provided by FXstreet)