Greece will leave the euro within the next year, says our City panel

Elizabeth Fournier
THE majority of our City A.M./ panel think Greece will leave the euro within the next year, with an overwhelming 78 per cent saying that the indebted country’s exit is likely.

Forty-six per cent said it was “very likely” that Greece would no longer be part of the euro by this time next year, while almost another third (32 per cent) see the departure as “somewhat likely”. Just 19 per cent said that a return to the drachma was unlikely.

As new Prime Minister Lucas Papademos begins his first full week in charge ending weeks of political uncertainty, he faces the prospect of having to negotiate a default scenario in his first month in power, with Greece only sitting on enough cash to survive until mid-December.

As for Italy, more than half of our panel (50.8 per cent) said that ex-Prime Minister Silvio Berlusconi’s departure from government would “make no difference” to Italy’s financial crisis. But 40 per cent were more optimistic, expecting Berlusconi’s exit to improve the country’s woes.

Our panel was also sceptical about the potential for Lloyds chief exec António Horta-Osório to return to his role, after he went on leave for illness. Thirty-nine per cent say Horta-Osório is unlikely to return, versus 30 per cent that expect him to come back.