FXStreet (Edinburgh) – The research team at BBH assessed the current scenario for the Greek PM A.Tsipras following the recent parliament vote.
Key Quotes
“Greece’s parliament approved the two measures needed for a third aid package”.
“It could cost Tsipras dearly. He had to again rely on opposition party votes. It is been suggested that a confidence vote could be called later this month or in September. Some do not expect him to survive the confidence vote”.
“This would force new elections. Although Tsipras remains among the most popular politicians in Greece, and could be re-elected, it would add another element of uncertainty into the mix”.
“In particular, it could impair the implementation of the reforms needed to free up aid for Greece itself rather than the funds needed to service its debt. There is a Eurogroup meeting today, and it will likely decided if there is sufficient time for several national parliaments to give their approval before the August 20, 3.2 bln euro payment to the ECB is due”.
“The German parliament is key. The indication is that it may take up the issue on August 18. A bridge loan is still possible, and the point is that one way or the other Greece will service its debt. The role of the IMF is still being discussed, but yesterday the IMF reiterated its position. It cannot participate in a more aid until two conditions are met: debt relief is provided that makes Greece debt burden sustainable, and Greece begins implementing its new program”.
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