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The talks in Brussels are going from problematic  to bad and much worse  . The Eurogroup text included things that seemed fictional not so long ago. One suggestion is that Greece passes state assets worth 50 billion euros to separate fund, basically ceding sovereignty. In addition,  Greece is required to pass  even harsher reforms by Wednesday. If not, it will be “temporarily” expelled from the euro-zone as if there is such a thing. Tsipras was personally humiliated by Merkel, the latter is the toughest. so far, Italian and French efforts  to mediate are not fruitful, apart from rejecting the “temporary Grexit”. Germany is  even at odds with the ECB.

Update:  Greek deal reached – EUR/USD doesn’t buy it

EUR/USD gaps lower to 1.11 after closing around 1.1150 on Friday, when there was optimism for a deal.

Greece agreed to everything creditors wanted in terms of austerity and asked for debt restructuring, which was in line with the IMF requests. But what seemed like an offer that could not be pushed back was severely rejected, and this exposes the German bluff.

It is hard to avoid the conclusion that Germany is either pushing for  a regime change or a Grexit.

Where is the IMF? Where is the US?

These are still very early hours and negotiations are still going on. So far, Greece has only  publicly rejected the idea to transfer state assets and the “temporary Grexit”.

more coming

Greek crisis – all the updates

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EURUSD early July 13 Gap lower on trouble in Greek talks