23 Jul 2015
Greece: New elections in the autumn almost unavoidable - RBS
FXStreet (Bali) - Michael Michaelides, European Rates Research Strategist at RBS, notes that after yesterday's Greek parliamentary approval on the second set of prior actions, a new reshuffle or more likely new elections in the autumn, once bailout negotiations have been completed, appear near unavoidable.
Key Quotes
"The Greek government last night passed the second round of prior actions (the new civil justice code, as well as a putting the European Banking Resolution and Recovery Law into
domestic law) meaning it has fulfilled its obligations allowing negotiations on a third bailout package to begin."
"The vote once again passed only on the strength of MPs from the three centrist opposition parties (Potami, PASOK and New Democracy), despite last week's government reshuffle. Across parties, the bill passed with 230 votes in favour and 63 against."
"The rebels from the governing coalition' s ranks were essentially unchanged at 31 (from 32 last week), though former Finance Minister Mr Varoufakis voting in favour this time was a surprise."
"The Greek government continues to rely on votes of opposition parties: an unsustainable situation in the mediumterm. It appears increasingly likely that there will be a split in the SYRIZA party between those in favour of the third bailout and those against."
"The former will be led by Mr Tsipras, whilst a number of prominent party figures may ultimately form a new movement to the left of SYRIZA. After yesterday's vote, a new reshuffle or more likely new elections in the autumn, once bailout negotiations have been completed, now appear near unavoidable.
Key Quotes
"The Greek government last night passed the second round of prior actions (the new civil justice code, as well as a putting the European Banking Resolution and Recovery Law into
domestic law) meaning it has fulfilled its obligations allowing negotiations on a third bailout package to begin."
"The vote once again passed only on the strength of MPs from the three centrist opposition parties (Potami, PASOK and New Democracy), despite last week's government reshuffle. Across parties, the bill passed with 230 votes in favour and 63 against."
"The rebels from the governing coalition' s ranks were essentially unchanged at 31 (from 32 last week), though former Finance Minister Mr Varoufakis voting in favour this time was a surprise."
"The Greek government continues to rely on votes of opposition parties: an unsustainable situation in the mediumterm. It appears increasingly likely that there will be a split in the SYRIZA party between those in favour of the third bailout and those against."
"The former will be led by Mr Tsipras, whilst a number of prominent party figures may ultimately form a new movement to the left of SYRIZA. After yesterday's vote, a new reshuffle or more likely new elections in the autumn, once bailout negotiations have been completed, now appear near unavoidable.