What price Greece staying a part of the Eurozone? That price might be as high as fiscal sovereignty, such is the loss of trust between debtor and creditors at the moment. Or at least creditors of a northern European persuasion. This is one of those difficult situations where it is easy to comprehend both sides of the argument. Would you want your country to surrender to external economic supervision? Would you be willing to lend to a debtor who has shown absolutely no evidence whatsoever of being a good credit risk? One thing must be clear by now, the Greeks have surely understood that Eurozone leaders are in a hard-line mood, the question is whether any agreement can be sold to the Greek people in time for an agreement to be made.
We will keep today’s blog short, because this crisis is the critical episode over the weekend, and the coming days. As fraught as discussions have been this weekend, the euro is trading comfortably within the range of Friday’s price moves. As things stand it seems likely that an agreement will have a positive effect on the euro, given the fact that EUR/USD is currently trading near the top of its daily range and the Eurozone’s ultimate flight to safety asset – bunds – have sold off slightly, the market is leaning in this direction. This is further confirmed by the strong start in the European equity markets.
News is likely to be fluid over the next 24 – 48 hours. We will be sure to tweet breaking news if it points towards resolution or the opposite.
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