Euroarea finance ministers meet to be dominated by Greece – RBC CM

Elsa Lignos, Senior Currency Strategist at RBC Capital Markets, suggests that today’s monthly meeting of euro area finance ministers will be dominated by Greece.

Key Quotes

“It is widely expected that FinMins will sanction the disbursement of the next tranche to Greece (EUR10bn). Finnish FinMin Stubb has declared himself “optimistic” and Greek assets rallied further on Monday, discounting that outcome, after further measures including contingency budget cuts were voted through on Sunday.

The disbursement would allow Greece to meet forthcoming debt repayments and clear arrears which have built up as the review has dragged on. The meeting will also discuss Greek debt relief, as the euro area looks to bridge the gap between it and the IMF on the sustainability of Greece’s debt and allow the IMF participate in the latest programme (a prerequisite for some euro area govts, notably Germany, Finland, and the Netherlands). A final agreement is unlikely to be reached yet though. On Monday the IMF called for “unconditional” debt relief – a step too far for some EZ govts.”