Greece will not pay the €1.6bn (£1.14bn) it owes to the IMF today, Athens has confirmed
The beleaguered country is required to make the repayment to its creditor by 11pm on 30 June, after saying it would bundle all its payments for the month into one transaction.
The IMF has Confirmed that Greece will immediately be in arrears if it defaults, raising fears of a Greek exit from the Eurozone.
The news is what markets have been waiting for – stocks are currently down across the world, from Hong Kong to London. Analysts at Barclays said it was “almost certain the Greek government will be unable to make the 30 June IMF payment”.
Greek banks were closed for the duration of Monday as the government imposes capital controls and tries to prevent insolvency.
On Saturday, Greek Prime Minister Alexis Tsipras called for a surprise referendum on whether to accept the creditors' proposals for a deal, which will be held on 5 July. This prompted the ECB to stop increasing emergency funding for Greek banks, which have been reliant on its support.
From today, Greece will have to survive without rescue loans for the first time in five years.
European leaders have urged the Greek people to vote "yes", highlighting Greece's exit from the Euro as a real possibility.
“You shouldn’t commit suicide because you’re afraid of dying,” Jean-Claude Juncker, the president of the European Commission, said in a speech, arguing that the budget cuts are good for their country.
“You should say ‘yes’ regardless of what the question is,” he said. A “no” vote, however, “will mean that Greece is saying ‘no’ to Europe.”