20 Feb 2015
Greek extension discussions might extend into next week – FXStreet
FXStreet (Barcelona) - Valeria Bednarik, Chief Analyst at FXStreet, comments on the ongoing noise surrounding the Eurogroup-Greece deal, further viewing that a Greek deal today is highly unlikely and the discussions could well extend into next week, only increasing chances for a further selloff in the single currency.
Key Quotes
“The last few days, contradictory headlines based on rumors, market talks, and other not that reliable sources, have been coming out every hour, boosting hope or announcing the doom of Europe. And this Friday is no different with the Eurogroup meeting scheduled for 16:30 GMT: Greeks say they have agreed on an "80% of a deal", while EU officials say it will be hard to reach a deal today."
“At this point, and despite the strong German opposition, Europe can't afford letting Greece go.”
“Is not just about contagion and the possibility of other economies leaving the common area, is about Greece defaulting. And indeed, Greece will default if forced out of Europe, not only on its rescue package but also on other liabilities to the ECB (and therefore, to other members of the union), estimated these days in around €80bn. That could put in risk of default another European countries which money suddenly vanished into the Greek hole, and a political crisis won't take long to follow. That's why the EU can't let Greece go.”
“But will policy makers agree to bend over the troubled country? If they do, what will be left of the "union" afterwards anyway?”
“..there are little chances a solution may be reached today, and the longer it takes, the higher is the risk of a Grexit and of a EUR/USD decline towards parity, as Greece is said to be running out of money as soon as February 28.”
“Negotiations can extend into next week, and investors will likely prefer to continue dumping Euros in favor of other assets. But a deal must be reached if Europe intends to survive.”
Key Quotes
“The last few days, contradictory headlines based on rumors, market talks, and other not that reliable sources, have been coming out every hour, boosting hope or announcing the doom of Europe. And this Friday is no different with the Eurogroup meeting scheduled for 16:30 GMT: Greeks say they have agreed on an "80% of a deal", while EU officials say it will be hard to reach a deal today."
“At this point, and despite the strong German opposition, Europe can't afford letting Greece go.”
“Is not just about contagion and the possibility of other economies leaving the common area, is about Greece defaulting. And indeed, Greece will default if forced out of Europe, not only on its rescue package but also on other liabilities to the ECB (and therefore, to other members of the union), estimated these days in around €80bn. That could put in risk of default another European countries which money suddenly vanished into the Greek hole, and a political crisis won't take long to follow. That's why the EU can't let Greece go.”
“But will policy makers agree to bend over the troubled country? If they do, what will be left of the "union" afterwards anyway?”
“..there are little chances a solution may be reached today, and the longer it takes, the higher is the risk of a Grexit and of a EUR/USD decline towards parity, as Greece is said to be running out of money as soon as February 28.”
“Negotiations can extend into next week, and investors will likely prefer to continue dumping Euros in favor of other assets. But a deal must be reached if Europe intends to survive.”