While Greece struggles to keep the economy afloat, the recently approved bridge loan will help the country meet today’s EUR 4.2 billion repayment to the European Central Bank and paves the way towards negotiations for further bailout funds essential for recapitalizing the banking system. However, in stark contrast to the fiery rhetoric out of Germany last week, Chancellor Angela Merkel has signaled the willingness of the European Commission to discuss the possibility of debt relief for Greece. This likely comes on the heels of remarks from both the ECB and IMF echoing the calls of the Greek Government to help make the outstanding debt commitments more sustainable. European participation in the next bailout is contingent on IMF participation, meaning that Europe’s negotiating position has been weakened by the IMF insistence on debt relief to increase the sustainability of debt.
Greek Banks Reopen
Daily Analysis - 20/07/2015