Euro Pares Gains, Stocks Rise

Germany’s DAX, which is stocked with exporters, jumped as the euro slipped from its high

By JOSIE COX

Updated May 14, 2015 1:18 p.m. ET

The Wall Street Journal

The euro pared gains against the dollar in late trade Thursday, sparking a stock rally led by Germany’s DAX index, which is packed with exporters.

The Stoxx Europe 600 ended the day 0.6% higher, led by a more than 1.8% gain on Germany’s DAX and a 1.4% gain on France’s CAC.

The euro weakened slightly after European Central Bank President Mario Draghi said that the ECB’s vast stimulus efforts will remain in place “as long as needed” until officials are confident they will meet their inflation objective on a sustained basis. The ECB’s bond-buying program has sent the euro sharply lower since it was first announced in January.

The euro was trading around 0.2% higher at $1.138, but was down from $1.145 earlier in the day—its highest level since late February.

A stronger euro is generally seen as bad for companies in the eurozone that generate a big chunk of their revenue overseas. The dollar enjoyed a stellar start to the year but has reversed direction in recent weeks amid a number of disappointing U.S. data releases.

“There is no denying the performance of the U.S. economy is falling well short of expectations” and is pushing back bets for when the Federal Reservewill raise rates, which is weighing on the dollar, said Lee Hardman, an economist at Bank of Tokyo-Mitsubishi UFJ.

BNP Paribas strategists also said the dollar weakness was likely to continue in the near term but added they broadly expect the buck to recover as the Fed gets closer to raising rates.

Eurozone bond markets were mostly stable Thursday after a selloff in recent weeks.

The yield on the German 10-year government bond, or Bund, edged slightly lower on the day to trade at about 0.70%, having risen from its all-time low of 0.05% in late April. Yields rise as bond prices fall.

“The bond rout isn’t going away for the summer and will weigh on all asset classes,” said Nick Lawson, a senior trader at Deutsche Bank.

Peter Chatwell, a rates strategist at Mizuho, said investors were unlikely to start buying bonds again in a big way until the current patch of volatility subsides. “They are on the sidelines waiting for the market to calm down,” he said.

In commodity markets, Brent crude was around 1% lower in late trade at $66.65 a barrel. Gold was up 0.3% at $1,222 a troy ounce.

Write to Josie Cox at josie.cox@wsj.com

This may be a greater risk for Greece than default

CNBC

Dhara Ranasinghe

Greece's anti-austerity government may think it's being squeezed by its international lenders but that could be nothing compared to the pressure it faces from the country's voters, experts warn.

The left-wing Syriza-led government under Prime Minister Alexis Tsipras has said it would not rush into a referendum or snap election to secure public support for the unpalatable reforms it may need to introduce to secure more funds. But analysts say neither can be ruled out as Athens desperately tries to avert a bankruptcy.

Greece's Varoufakis says debt swap fills Draghi's 'soul with fear'

 May 14, 2015 10:10am EDT

ATHENS

Reuters

Repayment of what Greece owes to the European Central Bank should be pushed into the future, but it is not an option because it fills ECB chief Mario Draghi's "soul with fear", Greece's finance minister said on Thursday.

Yanis Varoufakis said Draghi, president of the European Central Bank, cannot risk irritating Germany with such a debt swap because of Berlin's objection to his bond-buying program.

Το καθήκον των δημοσιογράφων

ΠΟΛΙΤΙΚΗ 13.05.2015 : 12:46

ΠΑΣΧΟΣ ΜΑΝΔΡΑΒΕΛΗΣ

ΕΦ. ΚΑΘΗΜΕΡΙΝΗ

Και για να έχουμε το καλό ρώτημα στη φιλοκυβερνητική «Εφημερίδα των Συντακτών»: πότε ακριβώς έπρεπε να μάθουν οι Ελληνες ότι «φυγή καταθέσεων που κινήθηκε σε ομόλογα του εξωτερικού ή προς τα “στρώματα” ανέρχεται σε 30 με 35 δισ.»; Πριν χρεοκοπήσει η χώρα ή μετά; Δεν όφειλε να ενημερώσει η Τράπεζα της Ελλάδος έναν δημοσιογράφο, που έθεσε το ερώτημα, ότι «λείπουν 20 δισ. από τα χαρτονομίσματα που είναι σε κυκλοφορία»;

Eurozone Economy Improves, but Finland and Greece Stumble

By DAVID JOLLYMAY 13, 2015

The New York Times 

PARIS — The eurozone economy grew modestly in the first quarter, an official report showed on Wednesday, as a surprisingly strong showing in France helped to compensate for a slowdown in Germany.

The economies of Finland and Greece, however, contracted for a second straight quarter, meeting the technical definition of a recession.

Greece Is Back In Recession; This Does Not Bode Well For A Debt Deal

MAY 13, 2015 @ 1:05 PM

Forbes

Tim Worstall

CONTRIBUTOR

We’ve the GDP figures for the various eurozone countries out today and Greece is officially and definitively back in recession. This does not bode well for the ability of Greece and the troika to come to a debt deal as recessionary times mean that the Greeks will find it near impossible to run the primary budget surplus that any deal would be predicated upon. There is a contrary view which is that the Eurogroup will agree that a surplus isn’t possible in such circumstances but that’s almost certainly not the way to bet.

Greece plays down referendum option, economy stutters

ATHENS | BY ANGELIKI KOUTANTOU AND RENEE MALTEZOU

Wed May 13, 2015 1:23pm EDT Related: GREECE

Reuters

Greece's government on Wednesday ruled out rushing to a referendum to secure public support for unpopular reforms, opting instead to make a final push for a compromise with lenders by the end of the month.

Running out of both cash and options to pursue, Prime Minister Alexis Tsipras was to preside over his third cabinet meeting in four days later on Wednesday to seek a way out of an impasse in talks with lenders who refuse to dole out more aid.

Τα στοιχεία που έδωσε ο κ Στουρνάρας για τις πρώτες 100 ημέρες της νέας κυβέρνησης ΣΥΡΙΖΑ

Συγκεκριμένα στην επιστολή με ημερομηνία 6 Μαίου και ώρα 2.12μ.μ. που έφυγε από το Γραφείου τύπου του Γ. Στουρνάρα με παραλήπτη γνωστό δημοσιογράφο υπό τον τίτλο «ο λογαριασμός των 100 ημερών» αναφέρεται ότι:

-Η φυγή καταθέσεων που κινήθηκε σε ομόλογα του εξωτερικού ή προς τα στρώματα ανέρχεται σε 30 με 35 δισ.

-20 με 30 δισ. η πτώση αξιών προς εισηγμένες και μη

-10 δισ. τα ρέπος

-3 δισ. οι παγωμένες πιστώσεις του ΕΣΠΑ. Έπρεπε να έχουμε πάρει 4 δισ. και πήραμε μόλις 1.

-20 δισ. λείπουν από τα χαρτονομίσματα σε κυκλοφορία

-Δεν μπορεί να υπολογιστεί η απώλεια σε χρεόγραφα που έχουν ο ξένοι επενδυτές. Έχουν 70 δισ. στα χέρια τους.
-Απαξίωση των ακινήτων

-3 δισ. λιγότερα στην αγορά από τη μη εξόφληση των υποχρεώσεων του δημοσίου προς ιδιώτες

-Στη ζημιά πρέπει να προστεθεί η στάση πληρωμών των ιδιωτών προς τις τράπεζες που αύξησαν τα κόκκινα δάνεια. Οι τράπεζες απέκτησαν επιπλέον πρόβλημα και ίσως χρειαστούν επιπλέον ανακεφαλαιοποίηση

Greece Completes Latest IMF Loan Repayment

Country drew on its holdings of an International Monetary Fund reserve currency

The Wall Street Journal

By MARCUS WALKER and  STELIOS BOURAS

Updated May 12, 2015 2:13 p.m. ET

23 COMMENTS

ATHENS—Greece drew on its holdings of an International Monetary Fund reserve currency to make a loan repayment of around €750 million ($837 million) to the IMF, an unusual move that buys the country a few more weeks to reach a deal with creditors on fresh financing.

Greece Dodges Economic Bullet With Progress Toward Deal

Bloomberg

by James G NeugerStephanie BodoniKarl Stagno Navarra

8:32 PM EEST

May 11, 2015

Greece handed the European Central Bank an excuse to maintain the life support for its financial system by persuading its skeptical German-led creditors it’s serious about delivering the policies needed to escape a default.

Less than three weeks after a Greek aid meeting broke up in taunts and acrimony, Finance Minister Yanis Varoufakis assured euro-area governments that his country is aiming to strike a bargain to win the final installments of its 240 billion-euro ($268 billion) aid program.

“We are making faster progress,” Dutch Finance Minister Jeroen Dijsselbloem told reporters in Brussels on Monday after leading a meeting of euro ministers. “I’m not satisfied but just a bit more optimistic.”

Exclusive: Greece tapped its emergency IMF reserves to pay IMF debt - sources

ATHENS | BY LEFTERIS PAPADIMAS AND GEORGE GEORGIOPOULOS

Tue May 12, 2015 8:26am EDT Related: WORLD, IMF

reuters

Greece emptied an emergency IMF holding account to repay 750 million euros ($839 million) due to the international lender, a Greek central bank official said, avoiding default but underscoring the dire state of the country's finances.

With Athens close to running out of cash and a deal with its international creditors still elusive, there had been doubts about whether the leftist-led government would pay the IMF or opt to save cash to pay salaries and pensions later this month.

Greece Moves to Pay Debt, but European Finance Ministers Unsatisfied

By LIZ ALDERMAN and JAMES KANTERMAY 11, 2015

New York Times

BRUSSELS — The government of Greece, quickly running out of cash, moved on Monday to quell fears of an imminent default on its debts, authorizing its treasury to make a big loan payment to the International Monetary Fund.

While Athens once again managed to pull together enough cash to avoid a default, it is not clear how much longer Greece can continue to scrape by.

Asia stocks, euro falter as Greek crisis saps confidence

Tue May 12, 2015 1:24am EDT Related: GREECE

TOKYO | BY SHINICHI SAOSHIRO

Reuters

Asian stocks were mostly lower and the euro sagged on Tuesday as barely perctible progress on talks between debt-strapped Greece and its creditors kept investors edgy.

Spreadbetters expected jitters over Greece to continue weighing on Europe, forecasting a slightly lower open for Britain's FTSE, Germany's DAX and France's CAC.

MSCI's broadest index of Asia-Pacific shares outside Japan was down 0.2 percent. Decliners included shares in South Korea, Hong Kong, Malaysia and Thailand, while Chinese equities bucked the trend and rose modestly.

IMF Works With Greece’s Neighbors to Contain Default Risks

Discussions with authorities in southeastern Europe aimed at girding for potential failure of bailout talks

 The Wall Street Journal

By GABRIELE STEINHAUSER

May 10, 2015 6:04 p.m. ET

0 COMMENTS

BRUSSELS—The International Monetary Fund is working with national authorities in southeastern Europe on contingency plans for a Greek default, a senior fund official said—a rare public admission that regulators are preparing for the potential failure to agree on continued aid for Athens.

I.M.F. and Central Bank Loom Large Over Greece’s Debt Talks

By PETER EAVIS, JACK EWING and LANDON THOMAS Jr.MAY 10, 2015

The New York Times

Greek leaders have fought fiercely in recent months with politicians from other European countries over relief on Greece’s vast debt load.

Yet the power to decide the fate of Greece lies not just in the hands of these national governments, but also with unelected officials at two powerful institutions: the European Central Bank and the International Monetary Fund. Each is a creditor to Greece, and each is expecting the country to repay it billions of dollars of debt in the coming weeks.

Merkel Pressed to Give Up on Greece as Germans Urge Strong Euro

Bloomberg 

by Brian ParkinRainer Buergin

4:05 PM EEST

May 10, 2015

German Chancellor Angela Merkel is coming under growing pressure from within the ranks of her own party bloc to give up on Greece for the sake of the euro.

Members of Merkel’s Christian Democratic bloc are openly challenging her stance of keeping Europe’s most-indebted country in the 19-nation currency region. Even some officials in the Finance Ministry are leaning toward the conclusion that the euro area would be better off without Greece, two people familiar with the matter said.

Making Sense of the Options for Greece

 10, 2015

Political Economy

By HUGO DIXON | REUTERS

Greece seems to lack a strategy for extricating itself from its parlous state.

Not only does the government, led by Alexis Tsipras, lack a credible plan for reaching agreement with its eurozone creditors and the International Monetary Fund, it doesn’t seem to have a thought-out fallback plan of how to default while containing the damage.

Greek financial markets have perked up in the past few weeks, largely because Yanis Varoufakis, the combative finance minister, has been sidelined from discussions with the creditors.

Documents Distributed by Greece’s Yanis Varoufakis Baffle Eurozone Officials

Officials say files differ greatly from what has been discussed in technical talks in Brussels

 The Wall Street Journal

By VIKTORIA DENDRINOU

Updated May 8, 2015 3:38 p.m. ET

30 COMMENTS

BRUSSELS—Economic plans and growth estimates distributed by Greek Finance Minister Yanis Varoufakis to some of his eurozone counterparts have baffled officials involved in the talks over its international bailout.

Officials say that the files differ greatly from what has been discussed at the technical level in Brussels in recent days and underline how Mr. Varoufakis continues to complicate progress toward a financing deal.

U.S. Urges Greece to Reject Russian Energy Project

By JAMES KANTERMAY 8, 2015

The New York Times

ATHENS — The United States, wading into the international efforts to shape Greece’s economic and geopolitical orientation, is pushing the leftist government in Athens to resist Russia’s energy overtures.

A State Department envoy in Athens urged Greece on Friday to embrace a Western-backed project that would link Europe to natural gas supplies in Azerbaijan, rather than agree to a gas pipeline project pushed by Moscow.

Greece Needs Some Post-Soviet Medicine

11 MAY 7, 2015 10:12 AM EDT

By Leonid Bershidsky

Bloomberg

The Greek government just pushed a law through parliament to rehire some of the public sector employees dismissed as part of previous creditor-dictated reforms. That's a strange move for a government already struggling to meet the existing public payroll, but to anyone familiar with post-Soviet economies, it's just a flashback.