Eurozone: ECB reveals surprise stimulus moves

In a surprise move. European Central Bank (ECB) has decided to cuts their interest rates from 0% to 0.05% and unveils a new stimulus plan to tackle deflation.

The bank will also expand its quantitative easing programme from €60bn to €80bn a month.

The ECB also decided to further cut its bank deposit rate, from minus 0.3% to minus 0.4%.

Conclusion: Whom saves Eurozone to stagnation? ECB or Super Mario Draghi.

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Europe: ECB moves to boost eurozone economy

The European Central Bank (ECB) has announced new measures to boost eurozone economy. It cutting a key interest rate and extending its stimulus programme.

The overnight deposit rate was cut to -0.3% from -0.2%, to push banks to lend instead of parking money at the ECB.

The ECB also extended its monthly €60bn stimulus programme by six months to March 2017, but left its main interest rate on hold at a record low of 0.05%.

ECB president Mario Draghi told a news conference that its bond-buying stimulus programme, or quantitative easing (QE), was working.

Conclusion: Even Draghi try to recovery eurozone economy again.

Greece: Tsipras calls for realism as talks start

The round of talks over Greek debt crisis starts a few minutes ago in Brussels. Greece’s PM Alexis Tsipras vows a realistic plan to tackle the crisis. But international creditors has its own plan.

French President Francois Hollande suggested Greece and its lenders were on the brink of a deal.

“We are days, I might almost say hours away from a possible resolution,” Mr Hollande said on Wednesday, adding that “asking too much of Greece would prevent the return of growth”.

Reports from Greece said Hollande, Tsipras and the German Chancellor, Angela Merkel, had already agreed to a deal on one key point.

The reports said the three had agreed in a telephone conversation on Wednesday to lower Greece’s primary budget surplus – the amount by which tax revenues exceed public spending.

Many points of the future deal was discussed tonight. A European Commission spokeswoman had earlier dampened hopes of an imminent breakthrough, telling reporters that no “final outcome” was expected from Wednesday’s talks.

Tsipras will hear details of the plan in the meeting with European Commission President Jean-Claude Juncker. The head of eurozone finance ministers, Dutch Finance Minister Jeroen Dijsselbloem, is also expected to take part in the talks.

The Greek leader’s own proposals, which he described as “a realistic plan for Greece to exit the crisis”, were dismissed by Mr Dijsselbloem as going “nowhere near far enough”.

However, failure to reach a deal could trigger a Greek default and a potential exit from the eurozone.

Syriza’s parliamentary group chairman Nikos Philis warned that if “we have no prospect of a deal on Friday or Monday, we won’t pay the money”, referring to the 5 June debt instalment to the IMF.

Mario Draghi, president of the ECB, said the bank wanted Greece to stay in the single currency, but that a “strong agreement” was needed between Athens and its creditors.

Conclusion: It’s a long night for Greeks and Europeans too.

Europe: Six days for Greece to offer new reforms

Greece is in trouble. Eurozone Finance Ministers has given six days for the country offer new reforms to seal a deal over rescue bailout. An EU official said: “If you take into account weekends and Orthodox Easter, there are only six days left.”

Greek prime minister Alexis Tsipras has said that Athens will not be able to service its debt without financial help from the European Union.

Greek Finance Minister Yanis Varoufakis said on Thursday that the government would restart the privatisation of state-owned businesses.

But on Thursday, Mr Varoufakis said: “What we are saying is the Greek state does not have the capacity to develop public assets.

“We want private-public joint ventures….we want to retain a stake for the state so as to have an income stream with which to finance pension funds.”

Conclusion: It’s hard times for Greek government.

Greece: Eurozone backs reform plans

The Greek plan was approved by Eurozone Finance Ministers on Tuesday. Now, it should be approved by national parliaments. The proposal includes:

  • Combat tax evasion
  • Tackle corruption
  • Commit not to roll back already introduced privatisations, but review privatisations not yet implemented
  • Introduce collective bargaining, stopping short of raising the minimum wage immediately
  • Tackle Greece’s “humanitarian crisis” with housing guarantees and free medical care for the uninsured unemployed, with no overall public spending increase
  • Reform public sector wages to avoid further wage cuts, without increasing overall wage bill
  • Achieve pensions savings by consolidating funds and eliminating incentives for early retirement – not cutting payments
  • Reduce the number of ministries from 16 to 10, cutting special advisers and fringe benefits for officials

Eurogroup said in a statmente: “We call on the Greek authorities to further develop and broaden the list of reform measures, based on the current arrangement, in close co-ordination with the institutions.”

The European Commission and the European Central Bank (ECB) both stated that the Greek proposals were a “valid starting point”.

The agreement had “averted an immediate crisis,” said European Commissioner for Economic Affairs Pierre Moscovici.

“It does not mean we approve those reforms, it means the approach is serious enough for further discussion,” he added.

However, International Monetary Fund (IMF) head Christine Lagarde expressed reservations about the reform proposals.

“In some areas like combating tax evasion and corruption I am encouraged by what appears to be a stronger resolve on the part of the new authorities in Athens,” she wrote in a letter to the Eurogroup.

“In quite a few areas, however, including perhaps the most important ones, the letter is not conveying clear assurances that the government intends to undertake the reforms envisaged.”

Eurogroup chairman and Dutch Finance Minister, Jeroen Dijsselbloem said the Greek government had a right to put its own “stamp” on the bailout programme.

“The new government is much more aggressive on taxes and corruption, and these are excellent things,” he told Dutch radio.

“But the Greek government is perhaps too optimistic about the speed with which they can boost tax revenues.”

Conclusion: Athens must be their debts or pull out of Eurozone.

Europe: Greece agrees deal with eurozone

After Europe underpressure to solve problems among Greece and Eurozone over Greek debt. Both sides has reached a deal over for extend the Greek financial rescue by four months. Dutch finance minister Jeroen Dijsselbloem, head of the Eurogroup, said that Greece had repeated its commitment to honour all debt in a timely manner. Conclusion: Calmness in Athens and anger in Berlin.

Greece: Compromise possible, says Merkel over bailout talks

After weeks of economic turnmoil. Greece and Europe is close to reach a bailout deal. German Chancellor Angela Merkel has said a compromise is possible in the stand-off with Greece over its bailout terms. But Merkel told reporters as she arrived for a conference with other EU leaders that “Europe’s credibility depends on us sticking to rules”.

Greece has refused to stick with current bailout terms and proposes a new deal over it.

On Wednesday, talks with other eurozone members failed to reach an agreement.

However both sides said there was still hope for a deal. Eurogroup President and Dutch Finance Minister Jeroen Dijsselbloem said the talks had been “constructive”.

The Greek Prime Minister Alexis Tsipras said as he arrived in Brussels for the summit that he was “very confident” a solution could be found to what he called the EU’s “humanitarian crisis”.

Merkel suggested there was negotiating room: “Europe always aims to find a compromise and this is the cornerstone of Europe’s success.

Conclusion: Greece and Europe still in a trouble honeymoon.