'Grexit' is back

Business Insider UK
Jim Edwards, Business Insider UK
Mar. 23, 2017, 12:16 PM

Greece's banks lost about €4 billion in bank deposits since the turn of the year as Greeks fear a return of capital controls that ban them from making cash withdrawals over set limits. Separately, the country looks as if it is tipping back into recession — GDP shrank by 1.2% in Q4 2016.

Does this story sound familiar?

It should. A collapsing economy followed by a run on the banks were the signal events of the Greek debt crisis that began in 2009 and never really ended.

So now people are asking — again — whether Greece might be forced out of the eurozone:

Greece to ease capital controls soon, needs debt measures: Stournaras

Thu Nov 10, 2016 | 5:50am EST

Reuters

By George Georgiopoulos and Balazs Koranyi | ATHENS
Greece will soon ease capital controls further but full liberalization will depend on progress in easing the country's debt burden, which is also a precondition for entering the ECB's asset buying scheme, central bank chief Yannis Stournaras said.

Propped up by three successive bailouts, Greece hopes to emerge from a long recession next year. But much of its outlook depends on getting a long-sought reduction of its huge debt pile, easing capital restrictions and inclusion in the ECB's 1.74 trillion asset buying scheme.

Time to talk about capital controls in Greece

Dhara Ranasinghe      

CNBC

Greece's economy and its banking sector are feeling the strain of the reforms-for-rescue deadlock between Athens and its international creditors – and fears are rising that ordinary people's bank accounts could be next to feel the squeeze.

Greek banks are increasingly reliant on emergency funding from the European Central Bank (ECB) to get by and analysts say that if the central bank curbs this lending, Greece may have no option but to impose capital controls.