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| Greek crisis: Referendum triggers new uncertainty ahead of crucial eurozone meeting - live updates | Greek crisis: Referendum triggers new uncertainty ahead of crucial eurozone meeting - live updates |
| (35 minutes later) | |
| 9.57am BST09:57 | |
| 9.47am BST09:47 | |
| And here’s another queue outside a Greek bank in the capital, via Associated Press (who say it didn’t actually open in the end) | |
| 9.42am BST09:42 | |
| From Athens, Sky News’s Rob Nisbet reports a long queue at one ATM machine: | |
| At least 40 people queueing at this ATM in Kallithea pic.twitter.com/1KDPHBcRFd | |
| 9.34am BST09:34 | |
| “We would consider the recent turn of events as a particularly negative market outcome”. | |
| That’s the snap verdict from Deutsche Bank, who say the question of Greece’s membership of the euro is now “officially opened”. | |
| Here’s the key points from a new research note issued by DB this morning: | |
| First, the European political response. | |
| A Euro leaders summit may be called at short notice. Similarly to the Papandreou referendum proposal in 2012, we expect that Europeans will make it clear that the government’s referendum will be equivalent to a question on euro membership. The Europeans will also need to decide on whether to grant a short-term legal extension to the loan agreement. Though we are still waiting for the European reaction, we consider a more likely outcome that the program is allowed to expire: extension requires multiple parliamentary approval processes, and given the tone of the Greek PM’s speech it is unlikely that the political appetite exists to grant such an extension. The IMF response will also be important: when and if Lagarde notifies the IMF board of a non-payment event, this will trigger cross-default on Greece’s EFSF loans and the EFSF board of directors (the finance ministers) will have the option, but not the obligation, to call these loans immediately due and payable. | |
| Second, the ECB response. | |
| The central bank has been holding daily reviews of Greek bank ELA provision this week, and officials have in multiple statements last week made it clear that ongoing liquidity provision is based on a “credible perspective” of an agreement being reached. Decisions are likely to be taken in conjunction with the European political response and program extension this weekend. The situation remains very fluid, but as things stand we consider the most likely outcome being an ECB decision not to raise ELA funding beyond existing levels as of this past Friday, or alternatively an aggressive adjustment in collateral haircuts resulting in an implicit cap at some point next week. The Greek deputy PM has said he will seek a meeting with ECB’s Draghi on Saturday. | |
| The third factor to watch will be public opinion polls on the referendum question. | |
| So far, these have shown that support for euro membership when an “unconditional” (“simple”) question is asked stands at around 70%. However, when this question is made conditional on more austerity, support drops to 55--65% depending on how the question is phrased. We expect the Greek PM’s position and the phrasing of the question itself to likely lead to additional swing towards a “no” vote. This is particularly so as Greek government officials have stated that the referendum will not be on euro membership, but rather the agreement. The extent to which European pressure and the situation of the banking system next week swings the vote the other way remains an open question. Overall, we expect the outcome to be very close and uncertain. The closer opinion polls are to a “no” vote, the greater probability is the market likely to price to a Greek Eurozone exit. | |
| 9.27am BST09:27 | |
| It sounds like Greece will be given a straight choice whether to accept, or reject, the package of measures drawn up by the IMF, ECB and EU: | |
| Referendum question as announced by House speaker is v. confusing "Citizens who reject proposal of 3 institutions yes/no" | |
| undefined | |
| Here is Referendum question (h/t @antheecarassava) Do citizens reject the proposal of the three institutions? NAI / OXI | |
| 9.23am BST09:23 | 9.23am BST09:23 |
| Greeks 'odd-on' to reject bailout terms | Greeks 'odd-on' to reject bailout terms |
| Ladbrokes, the betting firm, reckons that Greeks are likely to reject the proposal drawn up by its lenders: | Ladbrokes, the betting firm, reckons that Greeks are likely to reject the proposal drawn up by its lenders: |
| #Greece bailout #referendum odds: 1/3 NO to deal 2/1 YES to deal http://t.co/4CWIfTXJ2p pic.twitter.com/dY7OqtsnXX | #Greece bailout #referendum odds: 1/3 NO to deal 2/1 YES to deal http://t.co/4CWIfTXJ2p pic.twitter.com/dY7OqtsnXX |
| 9.15am BST09:15 | 9.15am BST09:15 |
| Coalition leader: Greeks shouldn't panic | Coalition leader: Greeks shouldn't panic |
| The head of the junior coalition party in Greece, Panos Kammenos, has told Greeks to remain calm, as banks will remain open. | The head of the junior coalition party in Greece, Panos Kammenos, has told Greeks to remain calm, as banks will remain open. |
| Kammenos told local TV that the decision to call a referendum shouldn’t spark alarm. | Kammenos told local TV that the decision to call a referendum shouldn’t spark alarm. |
| “Citizens should not be scared - there is no blackmail,” | “Citizens should not be scared - there is no blackmail,” |
| “The banks won’t shut, the ATMs will (have cash). All this is exaggeration.” | “The banks won’t shut, the ATMs will (have cash). All this is exaggeration.” |
| Kammenos, who leads the populist right-wing Independent Greek party, has also suggested that the referendum could yet be cancelled if creditors blink. | Kammenos, who leads the populist right-wing Independent Greek party, has also suggested that the referendum could yet be cancelled if creditors blink. |
| Ind Greeks leader Kammenos (coalition party) says if creditors back down & accept Greek proposal "everything changes-referendum called off." | Ind Greeks leader Kammenos (coalition party) says if creditors back down & accept Greek proposal "everything changes-referendum called off." |
| Updated at 9.18am BST | Updated at 9.18am BST |
| 9.12am BST09:12 | 9.12am BST09:12 |
| Cash machine queues in Athens | Cash machine queues in Athens |
| There are signs that worried Greeks are heading to the cash machines in greater numbers this morning. | There are signs that worried Greeks are heading to the cash machines in greater numbers this morning. |
| Ουρές σε ΑΤΜ στο Γαλάτσι pic.twitter.com/7LvU8v6Aoi | Ουρές σε ΑΤΜ στο Γαλάτσι pic.twitter.com/7LvU8v6Aoi |
| Denis MacShane, the former Labour MP, says he’s had some trouble getting money out in Athens: | Denis MacShane, the former Labour MP, says he’s had some trouble getting money out in Athens: |
| 2 out of 3 ATM in Athens refused my card and could only get €100 out of Eurobank one. Old Greek ladies shoving 1, 2, 3 cards into ATMs | 2 out of 3 ATM in Athens refused my card and could only get €100 out of Eurobank one. Old Greek ladies shoving 1, 2, 3 cards into ATMs |
| However, the situation seems calm on the Greek island of Poros: | However, the situation seems calm on the Greek island of Poros: |
| bank run watch, poros: two people at the ATM, both weekending yachties from athens. locals haggling with fishermen over day's catch. | bank run watch, poros: two people at the ATM, both weekending yachties from athens. locals haggling with fishermen over day's catch. |
| 9.00am BST09:00 | 9.00am BST09:00 |
| Introduction: Referendum debate and Eurogroup meeting | Introduction: Referendum debate and Eurogroup meeting |
| Good morning. | Good morning. |
| Europe has woken up to a new phase of uncertainty this morning after Greek Alexis Tsipras stunned the nation, and beyond, by calling a referendum on its bailout deal. | Europe has woken up to a new phase of uncertainty this morning after Greek Alexis Tsipras stunned the nation, and beyond, by calling a referendum on its bailout deal. |
| Related: Greek PM Alexis Tsipras calls referendum on bailout terms | Related: Greek PM Alexis Tsipras calls referendum on bailout terms |
| By taking the issue to the people, Tsipras has ensured that the next week or so will be absolutely critical for deciding Greece’s future in the eurozone. Starting right now. | By taking the issue to the people, Tsipras has ensured that the next week or so will be absolutely critical for deciding Greece’s future in the eurozone. Starting right now. |
| Greek PMs will be heading to parliament shortly to vote on whether to back Tsipras’s plan for a national vote on Sunday 5th June. | Greek PMs will be heading to parliament shortly to vote on whether to back Tsipras’s plan for a national vote on Sunday 5th June. |
| The debate starts at noon local time (or 10am BST), with a vote expected seven hours later. A simple majority is all it needs to put the issue in the hands of the Greek population. | The debate starts at noon local time (or 10am BST), with a vote expected seven hours later. A simple majority is all it needs to put the issue in the hands of the Greek population. |
| #Greece parliament plenary session at noon, #Eurogroup at 3pm (GR), vote on #Greferendum at 7pm (GR). #politics #euro | #Greece parliament plenary session at noon, #Eurogroup at 3pm (GR), vote on #Greferendum at 7pm (GR). #politics #euro |
| And while that’s happening, eurozone finance ministers will be heading to Brussels for another Eurogroup meeting. | And while that’s happening, eurozone finance ministers will be heading to Brussels for another Eurogroup meeting. |
| That session was due to start at 1pm Central European time (2pm Athens, or noon BST). Ministers were expected to see Greece handed a “take-it-or-leave-it” offer, in return for a bailout extension. | That session was due to start at 1pm Central European time (2pm Athens, or noon BST). Ministers were expected to see Greece handed a “take-it-or-leave-it” offer, in return for a bailout extension. |
| Tsipras, though, has already dismissed this offer of “severe and humiliating austerity without end”, and is asking creditors for a short extension to the current bailout (which expires on Tuesday). | Tsipras, though, has already dismissed this offer of “severe and humiliating austerity without end”, and is asking creditors for a short extension to the current bailout (which expires on Tuesday). |
| Will they agree, or will they press on with work on a “Plan B” for Greece, including capital controls? | Will they agree, or will they press on with work on a “Plan B” for Greece, including capital controls? |
| Today's Eurogroup has a big decision to make: do they extend bailout to 5th July or not? The Greeks have requested that & it would 1/2 | Today's Eurogroup has a big decision to make: do they extend bailout to 5th July or not? The Greeks have requested that & it would 1/2 |
| allow the ECB to keep funding the banks. But why agree from their point of view? Would require a difficult Bundestag vote. 2/2 | allow the ECB to keep funding the banks. But why agree from their point of view? Would require a difficult Bundestag vote. 2/2 |
| Tsipras’s decision to take the issue to the people has already fanned fears over its banks ability to keep running; will the European Central Bank continue to provide emergency help? | Tsipras’s decision to take the issue to the people has already fanned fears over its banks ability to keep running; will the European Central Bank continue to provide emergency help? |
| As our Athens correspondent Helena Smith reported: | As our Athens correspondent Helena Smith reported: |
| Describing the vote as a “historic decision”, Tsipras said he had informed the leaders of France, Germany and Mario Draghi, the head of the European Central Bank about the decision. “I asked them to extend our current bailout by a few days so this democratic process could take place,” he said. | Describing the vote as a “historic decision”, Tsipras said he had informed the leaders of France, Germany and Mario Draghi, the head of the European Central Bank about the decision. “I asked them to extend our current bailout by a few days so this democratic process could take place,” he said. |
| Greeks would be asked whether they wanted to accept or reject excoriating tax hikes and pension cuts that the EU, ECB and International Monetary Fund have set as a condition to release desperately needed bailout funds. Greece’s current rescue programme, already extended once, expires on 30 June. | Greeks would be asked whether they wanted to accept or reject excoriating tax hikes and pension cuts that the EU, ECB and International Monetary Fund have set as a condition to release desperately needed bailout funds. Greece’s current rescue programme, already extended once, expires on 30 June. |
| Panic-stricken depositors, worried that capital controls may only be hours away, rushed to ATMs to withdraw savings. Queues quickly formed outside banks around the capital . | Panic-stricken depositors, worried that capital controls may only be hours away, rushed to ATMs to withdraw savings. Queues quickly formed outside banks around the capital . |
| After months of wrangling between the Greek government and its creditors, matters are finally, dramatically, coming to a head. | After months of wrangling between the Greek government and its creditors, matters are finally, dramatically, coming to a head. |
| I’ll be tracking all the action though the day..... | I’ll be tracking all the action though the day..... |
| Updated at 9.01am BST | Updated at 9.01am BST |