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Trading news
21 Apr 2015
Capital controls could be implemented in Greece – TD Securities
FXStreet (Edinburgh) - In light of the recent IMF Spring Meetings, strategists at TD Securities are nor ruling out the possibility of capital controls in Greece in case the situation deteriorates further.
Key Quotes
“The Meetings also confirmed that there was no secret plan of agreement in waiting for Greece, and coupled with technical meetings over the weekend in Brussels, we seem to be quite far for a workable compromise”.
“This suggests that the odds may now be as high as 50/50 for capital controls to be implemented in Greece by mid-May”.
“We will have Deputy FinMins on a conference all this Wednesday followed by the Riga summit Friday, neither of which looks likely to deliver”.
“But Greece needs to agree to a small package of reforms by the May 11 Eurogroup to get the ECB to release the SMP profits on Greek bonds, otherwise their May 12 IMF repayment looks questionable”.
“Missing that will mean the ECB must decide whether the Greek situation has morphed from one of liquidity to solvency, and cause the “rules-based” framework to turn off the ELA and force Greece into capital controls”.
Key Quotes
“The Meetings also confirmed that there was no secret plan of agreement in waiting for Greece, and coupled with technical meetings over the weekend in Brussels, we seem to be quite far for a workable compromise”.
“This suggests that the odds may now be as high as 50/50 for capital controls to be implemented in Greece by mid-May”.
“We will have Deputy FinMins on a conference all this Wednesday followed by the Riga summit Friday, neither of which looks likely to deliver”.
“But Greece needs to agree to a small package of reforms by the May 11 Eurogroup to get the ECB to release the SMP profits on Greek bonds, otherwise their May 12 IMF repayment looks questionable”.
“Missing that will mean the ECB must decide whether the Greek situation has morphed from one of liquidity to solvency, and cause the “rules-based” framework to turn off the ELA and force Greece into capital controls”.