Officials of the European Central Bank may have tackle Greece debt restructuring, policy makers even when warned that such a step could trigger the beginning of a “sad story.”
The officials of Germany and France say the ECB will no longer receive debt Greece related collateral in money market operations, forcing the country to default, Regulation ECB less clear and just say that the “justifiable” if officials deem it necessary. The rhetoric of ECB will probably be a lot of forcing Greece to improve the budget cuts, the economists Citigroup Inc. and Deutsche Bank AG said.
“Without warning the ECB, Greece will not be given additional action announcement,” said Juergen Michels, Chief Economist at Citigroup in the euro zone. “The ECB indicates the eligibility requirements in rules guarantee that they can stretch everything pretty much.”
European policy makers to find ways to restore investor confidence to the concerns of increased that Greece will not be able to pay its debts after the bailout € 110 billion ($ 155 billion) last year. While the Minister of finance who consider options such as extending the maturity, the ECB policy makers argue that such measures could damage Greece and mess up the banking system of other countries in the euro area.
Great Impact
“The Restructuring is not a solution, it’s a sad story,” said a member of the Board of the ECB Christian Noyer on 24 May. His partner in Spain, Jose Manuel Gonzalez-Paramo said last month those steps would “very likely” to have systemic consequences “very probably more ruined from” the collapse of Lehman Brothers Holdings Inc. in September 2008.
Action Of Greece
The Government of Greece this week to support the sales plan for accelerated and asset package of budget cuts in an effort to meet the requirements for the fifth phase of the bailout by the Treaty with the European Union, IMF and the ECB.
The ECB can still find room for manoeuvre where the bond market sell-off in Greece intensified on concerns that more austerity measures will not be enough to counteract the default.
The Vienna Initiative
One option for the ECB likely to embrace the proposal Vienna Initiative which is disusulkan by the economic and monetary Commissioner, Olli Rehn, which aims to persuade creditors to buy new bonds of the Government of Greece maturity which is near.
Almost half of the 23 members of the Governing Council of the ECB currently supports the idea, according to someone who is familiar with the matter, who refused to identify himself because the discussion about this secret.
“Considering all the options being discussed, this probably is one way that the ECB can be in line with,” said Citigroup Michels.
See more NEWS at www.ForexTradingEVO.com