This article is from the source 'guardian' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.

You can find the current article at its original source at https://www.theguardian.com/business/live/2016/may/25/greek-debt-deal-imf-eurozone-markets-shares-business-live

The article has changed 16 times. There is an RSS feed of changes available.

Version 11 Version 12
Debt campaigners criticise IMF over Greek deal - live updates Debt campaigners criticise IMF over Greek deal - live updates
(about 1 hour later)
4.26pm BST
16:26
And now some comments emerging from the IMF:
*IMF OFFICIAL: NEED MORE CONCRETE DEBT-RELIEF DETAILS ON GREECE
*IMF SHOULD BE ABLE TO CONSIDER GREEK LOAN BY YEAR-END: OFFICIAL
#IMF NOT ENDORSING GREEK DEAL UNTIL BOARD APPROVES - IMF SHOULD BE ABLE TO CONSIDER GREEK LOAN BY YEAR-END: OFFICIAL
4.17pm BST
16:17
Here’s a timeline of Greece’s incoming bailout funds and outgoing payments in the next few months:
4.12pm BST
16:12
European markets are holding onto their gains as they head to the close. Jasper Lawler, market analyst at CMC Markets, said:
Stocks extended gains on Wednesday as a tentative agreement on Greek debt relief and a fresh seven-month high in the price of US oil offered more cause for optimism. Banks were top risers for a second day as markets price-in the earnings benefit of a possible US rate rise in the summer. Banks in the peripheral of Europe most exposed to Greek debt, including Spain’s Banco Santander, were top performers.
Less exposure to Greece and weak earnings from M&S weighed on the FTSE 100, which rose less than its European counterparts.
Greek shares rose and the yield on Greek Debt fell after the IMF and Germany deferred a quarrel on Greek debt relief until 2018... Greece avoiding another cliff-edge moment is undoubtedly positive for markets, which already face the uncertainty of the Brexit referendum and Spanish elections in June.
4.09pm BST
16:09
The funds to be released following the late night Eurogroup agreement should last Greece until the end of October when the second review of the bailout programme is due start, according to the Athens-Macedonian News Agency. It says:
The €10.3bn tranche that the Eurogroup decided to disburse to Greece will fully meet the country’s financing needs until the end of October, when the second review of the Greek programme is set to start, Eurozone officials said on Wednesday.
Describing the events behind the scenes at Tuesday’s Eurogroup, the sources said that the IMF and Europeans had reached a compromise in spite of their different initial positions, while confirming that the IMF will participate. According to one EU official, this was not so much a “power play” but more that all sides moved from their initial position, with the IMF fully understanding that the Eurozone operates in a different way from the fund.
Regarding the measures for the debt, the European sources said that there were no “immediate decisions” but this was not a surprise, since there were no debts maturing in the short term. In the medium-term, the Eurozone countries said they will examine the possibility of buying up debt to the IMF early, or the bilateral loans with Eurozone countries, using the unspent funds (approximately 20 billion euros) originally destined for the recapitalisation of the banks. This would, however, require the approval of some national parliaments.
According to Eurozone officials, the chances that Greece can return to borrowing from the markets at reasonable interest rates at the end of the programme are much higher following the agreement at Tuesday’s Eurogroup. They said that Greece’s access to the markets can begin to be restored gradually, in the second half of 2017, and that the aim is to restore full market access by the end of 2018.
The more credible Greece’s economic policy, including its success in delivering primary surplus targets, the smaller the spreads on Greek bonds will be, though borrowing from the Eurozone will always be cheaper, the same sources said. The second review of the Greek programme would begin at the end of October, they added, noting that the measures that remained to be taken will not be as difficult as those required by the first review.
3.54pm BST
15:54
Helena Smith
In Greece trade unionists are already flexing their muscles and planning mass industrial action, reports Helena Smith.
Strikes are expected to start tomorrow when workers at the Piraeus Port Organisation and Thessaloniki Port Organisation begin a 48-hour walk-out in opposition to the controversial privatisation programme the government has signed up to.
Adedy, which represents employees in the public sector, has also decided to hold a Pan-Hellenic work stoppage on June 8. “We decided, today, after meeting health and education federations that we would take this action to protest all the things that these new measures mean: lack of staff, underfunding, appointments that should, but will never happen,” Adedy’s chief policy maker, Grigoris Kalomoiris told the Guardian.
“The Eurogroup was a fiasco for Greece. The government was just a spectator while Germany rode roughshod over everyone else and made all the decisions. To conclude the review we agreed to sell off all our public wealth and impose more of the same counter-productive measures. It makes no sense. Come September/October we foresee mass and dynamic reaction because it is then that the measures will start to kick in.”
Kalomoiros said the trade union now firmly believed the only way out for the debt-stricken country was to leave the eurozone.
3.10pm BST3.10pm BST
15:1015:10
Back with German finance minister Wolfgang Schäuble. According to Bloomberg he has said a fourth Greek bailout programme is not needed as of now.Back with German finance minister Wolfgang Schäuble. According to Bloomberg he has said a fourth Greek bailout programme is not needed as of now.
2.55pm BST2.55pm BST
14:5514:55
Wall Street opens higherWall Street opens higher
As expected, US markets have followed their counterparts elsewhere and moved higher in early trading, partly buoyed by the Greek agreement overnight and continuing strength in the oil price.As expected, US markets have followed their counterparts elsewhere and moved higher in early trading, partly buoyed by the Greek agreement overnight and continuing strength in the oil price.
The Dow Jones Industrial Average is currently up 124 points or 0.7% while the S&P 500 opened up 0.28% and Nasdaq 0.34% better.The Dow Jones Industrial Average is currently up 124 points or 0.7% while the S&P 500 opened up 0.28% and Nasdaq 0.34% better.
The moves came despite some weaker than expected US services and composite PMI data.The moves came despite some weaker than expected US services and composite PMI data.
[BREAKING] US Markit Services PMI May P: 51.2 (est 53; prev 52.8)-Composite PMI May P: 50.8 (prev 52.4)[BREAKING] US Markit Services PMI May P: 51.2 (est 53; prev 52.8)-Composite PMI May P: 50.8 (prev 52.4)
Markit Flash U.S. Composite #PMI Output Index falls from 52.4 in April to 50.8 in May https://t.co/6Wwc4mI64S pic.twitter.com/aSKC3cAXNwMarkit Flash U.S. Composite #PMI Output Index falls from 52.4 in April to 50.8 in May https://t.co/6Wwc4mI64S pic.twitter.com/aSKC3cAXNw
US business optimism lowest since 2009 according to Markit services flash PMI respondents pic.twitter.com/vpgff4wLNyUS business optimism lowest since 2009 according to Markit services flash PMI respondents pic.twitter.com/vpgff4wLNy
UpdatedUpdated
at 2.59pm BSTat 2.59pm BST
2.46pm BST2.46pm BST
14:4614:46
Schäuble also said there were no major changes to the Greek bailout programme, according to Reuters, so there was no need for German parliamentary approval.Schäuble also said there were no major changes to the Greek bailout programme, according to Reuters, so there was no need for German parliamentary approval.
#Germany finance minister #Schaeuble 'asumes' @HiBTag Budget Committee would back #Greece deal#Germany finance minister #Schaeuble 'asumes' @HiBTag Budget Committee would back #Greece deal
UpdatedUpdated
at 2.47pm BSTat 2.47pm BST
2.29pm BST2.29pm BST
14:2914:29
German finance minister Wolfgang Schäuble has said last night’s result on Greece was a good one, and the next tranche of aid can now be paid out. But it looks like it’s not all sweetness and light with the IMF:German finance minister Wolfgang Schäuble has said last night’s result on Greece was a good one, and the next tranche of aid can now be paid out. But it looks like it’s not all sweetness and light with the IMF:
"It wld have been helpful if the (IMF) managing director had been present.That wld have saved us a few hours,"Schaeuble says of Greek talks."It wld have been helpful if the (IMF) managing director had been present.That wld have saved us a few hours,"Schaeuble says of Greek talks.
UpdatedUpdated
at 2.30pm BSTat 2.30pm BST
2.02pm BST2.02pm BST
14:0214:02
Here’s a link to the transcript of the comments by Klaus Regling, head of the European Stability Mechanism, after last night’s Eurogroup meeting:Here’s a link to the transcript of the comments by Klaus Regling, head of the European Stability Mechanism, after last night’s Eurogroup meeting:
Transcript of #ESM MD Klaus #Regling at #Eurogroup press conference https://t.co/fxmZ3XaHLs pic.twitter.com/CDOzoiGkoATranscript of #ESM MD Klaus #Regling at #Eurogroup press conference https://t.co/fxmZ3XaHLs pic.twitter.com/CDOzoiGkoA
1.51pm BST1.51pm BST
13:5113:51
Markets continue to be buoyed by the early morning Greek deal, although are now off their best levels.Markets continue to be buoyed by the early morning Greek deal, although are now off their best levels.
Banks are among the main movers, both on the Eurogroup agreement and because a rise in US interest rates, which could come as early as June or July, is likely to bolster their balance sheets.Banks are among the main movers, both on the Eurogroup agreement and because a rise in US interest rates, which could come as early as June or July, is likely to bolster their balance sheets.
In Greece, the Athens market is currently up 0.45%, while the country’s 10 year bond yields are down 8 basis points at 7.3%. Two year bond yields are currently down 87 basis points at 7.37%.In Greece, the Athens market is currently up 0.45%, while the country’s 10 year bond yields are down 8 basis points at 7.3%. Two year bond yields are currently down 87 basis points at 7.37%.
Elsewhere in Europe, Germany’s Dax is up 1.4%, France’s Cac has climbed 1.1%, Italy’s FTSE MIB is up 1.3% and Spain’s Ibex has added 2.1%.Elsewhere in Europe, Germany’s Dax is up 1.4%, France’s Cac has climbed 1.1%, Italy’s FTSE MIB is up 1.3% and Spain’s Ibex has added 2.1%.
Meanwhile the FTSE 100 is up 0.6% and on Wall Street, the Dow Jones Industrial Average is forecast to open around 73 points higher.Meanwhile the FTSE 100 is up 0.6% and on Wall Street, the Dow Jones Industrial Average is forecast to open around 73 points higher.
European & US stock markets follow-through on yesterday's exceptional rise in equities as new Greek debt deal comes into focus. #stocks ^JCEuropean & US stock markets follow-through on yesterday's exceptional rise in equities as new Greek debt deal comes into focus. #stocks ^JC
UpdatedUpdated
at 1.55pm BSTat 1.55pm BST
1.33pm BST
13:33
The European Central Bank holds its regular meeting next week and some are hoping that it will discuss reintroducing a waiver to allow the central bank to accept Greek bonds (as UniCredit suggested below). FastFT reports (£):
Greek officials are optimistic that the eurozone’s top monetary policymakers will take a big step towards rehabilitating the country’s banking system next week, by deciding to accept Greek bonds as collateral for the European Central Bank’s loans for the first time in more than a year.
The ECB’s governing council...will meet next Thursday in Vienna. Officials are likely to use the Vienna meeting to discuss whether to reintroduce a waiver that allows the eurozone’s central bank to accept Greek debt in its regular auctions of central bank cash. Athens is confident that the council will support the reintroduction of the waiver.
The waiver was scrapped in February 2015 as the crisis escalated.
Updated
at 1.34pm BST
1.16pm BST
13:16
Someone else who thinks Germany gave the least ground at the marathon Eurogroup meeting, given the delay on any major decisions on debt. Economist Tullia Bucco at UniCredit Research said:
In our view, there are two important features in this framework that are intended to provide reassurance to the European creditors for which Greece poses a thorny political issue: 1. The bulk of the debt-relief measures will only be granted at the end of the program in 2018, if necessary, and 2. Long-term relief measures remain very vague.
All in all, Germany can be considered to be the winner of the negotiations, given that any major decision on debt relief will only be taken after next year’s general elections, whereas the IMF committed to participate financially to the program already before the end of 2016.
The agreement could also pave the way to returning Greek banks to some kind of normality:
Last but not least, we think that the deal would soon allow the ECB to reinstate the waiver for Greek bonds posted as collateral at its refinancing operations. This is good news for Greek banks.
Updated
at 1.26pm BST
1.13pm BST
13:13
There were some tired faces at today’s ECOFIN meeting, among ministers who worked late into the night on the Greek agreement.
Greece’s finance minister, Euclid Tsakalotos, looked positively pensive at one point:
Tsakalotos also had an expressive chat with Pierre Moscovici, EU Commissioner for Economic Affairs...
1.04pm BST
13:04
All sides made some concessions at last night’s Eurogroup meeting, but it does seem that Germany gave the least ground.
Writing for Macropolis, the Greek analysis site, Yiannis Mouzakis explains:
German Finance Minister Wolfgang Schaeuble is probably the one participant in the Eurogroup that completely achieved his objective. His only concession is that he had to compromise on his initial stance that Greece’s debt does not need to be discussed before 2023.
There is nothing in this agreement to make him uncomfortable beyond that. It does not require any major changes to the programme’s modalities, the targets remain, large-scale debt measures are not due to happen until after the German elections in autumn next year and the IMF has committed that it will go to its board with a recommendation to participate in the Greek programme with financing and a new programme that will ensure policing of compliance and reform implementation.
Yiannis also cautions that today’s deal could turn sour in a few months, particularly if the IMF concludes that Greece’s debt relief doesn’t go far enough.
Here’s the piece: A Eurogroup deal that might be hard to stomach
12.36pm BST
12:36
The mood in Athens
Helena Smith
Over in Greece, the government’s supporters have hailed the eurogroup deal.
Opponents, though, have dismissed it - and argued that Greece must leave the euro.
Our Athens correspondent, Helena Smith, reports
The sense of déjà vu – the underlying current of this six-year crisis – was in full play this morning, in the media, on the streets and in the commentary of politicians, trade unionists and businessmen, the actors in the drama.
While pro-government newspapers lauded the “white smoke” that had finally appeared at the end of a gruelling 11-hour euro group, opposition newspapers slammed it as a sham.
Avgi, mouthpiece of prime minister Alexis Tsipras’ leftist Syriza party, enthused:
“The review has been concluded, roadmap [agreed] for the debt.”
The paper quoted Syriza’s prominent MEP Dimitris Papadimoulis as saying Athens had finally moved on from vagaries to concrete plans regarding the country’s staggering debt pile.
“We are no longer speaking about the debt in general, vague terms but have a framework of an agreement, a concrete roadmap,” he said of the decision to deal with debt load in three stages, adding:
“It’s a good decision that allows us to turn the page.”
On the streets, however, enthusiasm was remarkably muted. Shopkeepers shrugged off any suggestion that Greece was about to turn the corner.
“It might bring some stability,” said Panos Tsekouras who runs a textile store in the heart of downtown Athens. “We won’t see the drama of last year but once the summer is over and the taxes have piled up who is going to pay the bill? There’ll be mayhem.”
Opposition politicians from the left and right described the deal as a fiasco.
Speaking to the Guardian, Panaghiotis Lafazanis, the former energy minister who broke ranks with Syriza to set up the breakaway anti-austerity Popular Unity party, predicted it would be only a matter of time before there was widespread reaction when the government tried to enforce new taxes and cuts.
Lafazanis told me:
“It won’t be able to enforce the measures it has agreed to. This is an agreement that solves no problems and on the contrary creates new ones.
Greece, simply, cannot survive in this currency. There will be a disorderly default and ultimate exit from the euro that will be all the worse for not being planned.”
12.30pm BST
12:30
Austria’s finance minister, Hans Jörg Schelling, hopes that the eurozone will avoid a summer of Greek debt drama.
Austrian Fin Min #Schelling: "I value the Greek summer - but not in Brussels." #Eurogroup #Greece #Eurozone -- @dpa.
12.24pm BST
12:24
Analyst Wolfango Piccoli of Teneo Intelligence is concerned that Greece hasn’t won the solid commitments which prime minister Alexis Tsipras has promised.
That may make it harder for Tsipras to hold his small parliamentary majority together, and implement the unpopular austerity measures it has agreed to.
Here’s Wolf’s key points:
Updated
at 12.37pm BST
12.00pm BST
12:00
The Greek agreement is part of a broader strategy to avoid rocking the boat until Britain’s EU referendum is over, argues my colleague Jonathan Freedland.
He writes:
Whatever the rights and wrongs of the [Greek] austerity argument, Cameron has wanted the issue to go away – at least for another month. Today’s bailout loan has achieved that.
Related: The Greek bailout shows the EU is on its best behaviour – until 24 June | Jonathan Freedland
Updated
at 12.02pm BST
11.28am BST
11:28
Moody's: Greek deal is credit positive
Rating agency Moody’s has just announced that the Greek deal is “credit-positive”.
Moody’s says the promise of €10.3bn of bailout loans alleviates the danger that the country defaults this summer.
It also welcomes the “road map” on debt relief agreed by creditors, although it is light on details.
Although the announcement doesn’t provide specifics on the type of relief, it is clear that material relief will be considered only after the program expires in 2018 and remains contingent on the Greek governments’ ability to implement successfully the conditions associated with the program.
However, the agency is also concerned that Athens will struggle to implement the measures agreed with creditors.
We consider implementation risks in Greece to remain high, given the small governing majority, weak institutions, and the backdrop of political and social discontent.”
It's official: Can-kicking = good https://t.co/oDAY6oQxrA
Updated
at 11.34am BST
11.19am BST
11:19
Mihir Kapadia, CEO at Sun Global Investments, is relatively upbeat about the deal:
The Eurozone provided Greece with a firm offer of debt relief yesterday at a meeting of finance ministers in Brussels, a decision which could see the Euro provide €10bn in new funds for the country. The IMF seems to have softened its stance significantly from its hard line position as it had previously insisted that Greece’s proposed programme did not offer a path to fiscal sustainability.
The positive conclusions to these talks are a good sign on a number of fronts – showing flexibility by the IMF and European ministers, and some early signs of improving confidence in Greece. Greek 10-year bond yields fell below 7% this morning for the first time since November 2015.”