Markets lifted despite denials over Greek deal
EUROPEAN stock markets rallied yesterday as the Greek government offered reassurances that it would strike a deal with creditors, but Brussels was quick to dismiss the prospect of an imminent compromise.
Markets initially climbed when a Greek government official said: “At a Brussels group [a meeting between technical teams from Greece and its creditors] today procedures to draw up a staff-level agreement are beginning”.
It was followed by an optimistic tone from Prime Minister Alexis Tsipras.
“We took many steps. We are on the final stretch toward a positive deal,” Tsipras said after a meeting at the Greek finance ministry with finance minster Yanis Varoufakis and the rest of his negotiating team.
Yet one Eurozone official dismissed the Greek positivity as “nonsense”, when speaking to Reuters.
Seeking to explain the confusion, a Greek government official said that while a deal was close, the statement may have been misunderstood.
“At the Brussels group the procedures have started the drafting of a staff level agreement; now, the procedures of drafting is one thing, whether we have agreed on a particular draft is another thing,” he told
City A.M. “One can say that the whole of the Brussels group over the past three months has been the procedure of drafting.
“Unless the IMF budges and comes closer to the European Commission there can’t be any progress.”
The official also said there would be no meeting of deputy finance ministers today, and that technical teams would most likely be in discussions until the end of this week.
A Euro Working Group – the term for a meeting of deputy finance ministers – would be the next stage of negotiations once technical teams reach agreement. The final stage is a meeting of Eurozone finance ministers, known as a Eurogroup.
Yields on Greek government debt fell yesterday, despite the denials from some Eurozone officials that a bailout deal is close.