Fresh round of reform it is not enough
According to The Guardian[i], in Greece the government announced a fresh round of austerity measures on Tuesday, including pension cuts and tax rises for low earners, in an attempt to persuade its creditors, including the IMF, to release the latest €8bn tranche of rescue funds. But many investors now believe default for the debt-burdened state is inevitable, and they are still fretting about the potentially devastating impact of a default on the region’s banks.
The Greek debt needed restructuring last year, when it was known to be impossible to meet, and the country and the entire euro area were in a better position to renegotiate with banks and investors[ii]. Now it seems too late; the collapse is just around the corner.