BY ANY reckoning today is a crucial moment in the extraordinary Greek debt-crisis drama, as two deadlines pass, with fateful consequences. The first is a payment that is due to be made to the International Monetary Fund by June 30th. The second is the expiry of the bail-out agreement between Greece and its international creditors, leaving it for the first time in five years without official support. Is there any chance that Alexis Tsipras, the Greek prime minister whose ill-judged decision to call a referendum on the terms of a renewed bail-out agreement has caused Greek banks to be closed for at least the next week, might pull back from the brink?
As things stand the first deadline will be missed. The Greek government—which is as strapped for cash as its citizens (who can only withdraw €60 a day from ATMs)—does not have the money to pay the IMF the €1.5 billion ($1.7 billion) that is due this evening. Yanis Varoufakis, Greece's finance minister, confirmed on June 30th that Greece will not make the payment. Greece will therefore suffer the ignominy of becoming the first advanced country to default to the IMF, joining the likes of Sudan and Zimbabwe in that hall of shame. Technically it will go into arrears but Christine Lagarde, the head of the IMF, has said there will be no grace period. In short, it will amount to a default.
Although this will be...Continue reading
Source :Business and finance http://ift.tt/1LzHDue
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