Greek debt yields rise as potential default looms
Adam Pike, News Editor
14 Apr 2015, 10:39 a.m.
Yields on Greek 3, 5 and 10 year bonds rose yesterday after German newspaper Frankfurter Allegemeine Sonntagszeitung reported Eurozone officials are “disappointed” with the lack of progress with Athens over their debt negotiations.
The newly elected government, which is quickly running out of money to pay public pensions and salaries has decided to hold back 2.5bn euros which is due to be paid to the IMF in May and June if no agreement is struck.
“We have come to the end of the road. If the Europeans won’t release bailout cash, there is no alternative but to default,” one government official said. Unless Greece agrees to further reforms and austerity measures no further money will be released to the cash strapped nation.
Eurozone ministers will sit down again in two weeks’ time to discuss the countries debt obligations. Credit analysts are becoming concerned Greece will be unable to meet a 950m euros repayment to IMF. The government also needs to find 2.4bn euros to pay state pensions and salaries. If a deal can’t be made in Aprils meeting many fear the country will have insufficient funds to make it through the summer.