There’s growing pessimism of a breakthrough deal between Greece and its creditors, as world finance chiefs gather in WashingtonLatest: FT says Greece wants to delay IMF repaymentsGreek bond yields rise as default fears growIntroduction: Hopes fading for Greek deal as IMF/G20 meeting beginsECB protester heads home 10.40am BST Financial news service Ransquawk has rounded up the next series of debt repayments which Greece faces:Key Greek Dates 17Apr €1b redemption 24Apr runs out of cash Apr end - €1.7b payment due for public wages&pensions 8May €1.4b redemption 1/2Key Greek Dates: 12May €779m IMF repayment 11May Eurogroup meeting 15May €1.4b bill redemption 20July €3.5b bond redemption due 2/2 10.31am BST European stock markets are edging down this morning, with the Greek crisis giving little reason for optimism: 10.12am BST It’s not ALL doom and gloom this morning. European car industry is reviving, with sales across the EU jumping by 10.6% year-on-year in March.Sales in Spain, Portugal and Ireland all led the way:That last chart from Pantheon Macro - country by country breakdown here. +40% in Portugal too, +32% in Ireland. pic.twitter.com/N4GQmjxDlD 10.03am BST Greece’s prime minister needs to make concessions to creditors soon, before the situation deteriorates further, argues Janis Emmanouilidis of the European Policy Centre, a think tank.High time for #Tsipras government to compromise. Negative economic & political consequences too high if developments spiral out of control. 9.45am BST The financial markets are now pricing in a 77% chance that Greece will default in the next five years, data firm Markit says.Markit’s chief economist, Chris Williamson, explains:The cost of insuring against a default by the Greek government has spiked sharply higher as worries about the ability to meet debt repayments have intensified. Credit default swap prices, which provide investors with protection to insure against debt default have surged higher. The CDS market is now implying a 77% probability of default by the Greek government in the next five years, according to Markit data. 9.37am BST This looks worrying. The Financial Times is reporting that Greek officials have made an “informal approach” to the International Monetary Fund to delay repayments of loans to the international lender, but were rebuffed.It’s another sign that Athens is running perilously short of funds, and is worrying how it will meet next month’s bills (both €900m+ owed to the IMF, and its public sector wages and pensions).According to officials briefed on the talks by both sides, Athens was persuaded not to make a specific request for a delay to the Fund, which is owed almost a €1bn in two separate payments due in May.Although Athens was rebuffed, the discussions, which occurred in private earlier this month, are a sign that the Greek government is finding it increasingly difficult to scrape together enough money to continue to pay wages and pensions while meeting its debt payments to external lenders.Greece went ahead and (quietly) asked IMF if it could delay loan repayments. Quite a moment. The fund said no http://t.co/Zm5nisLmRF#Greece 10Y yield soars as GrGov seeks #IMF installment delay pic.twitter.com/RYeUGl3Oqv 9.20am BST Two-year Greek bonds are now at their weakest level since last summer:* Greek two-year bond yields rise 230 bps to 26.14 percent, highest since issue in July 2014 - Tradeweb 9.11am BST Another sign of growing Greek concern:*GREEK THREE-YEAR BOND YIELD CLIMBS TO 26.09%, MOST SINCE 2012 9.10am BST Greek government bonds are weakening this morning as concern grows that Athens and its creditors are nowhere close to a deal.Last night’s credit downgrade from S&P is also helping to drive Greece’s bond yields higher. “Just the thought of holding a referendum is an admission of an impasse. If they move forward with such an idea, they turn this impasse into a tragedy.”ND believes #Grexit is possible. #Greece's 2yr yields jump to almost 25%. http://t.co/qizVYfkQue pic.twitter.com/3WkLK0qL58 8.48am BST The Greek crisis will be centre-stage in Washington as G20 finance ministers and central bankers gather for the IMF’s spring conference, says Mike Peacock of Reuters.He writes:Most of the protagonists in the Greek saga will there including Finance Minister Yanis Varoufakis who is due to hold talks with both President Barack Obama and ECB chief Mario Draghi. He can presumably expect some sharp words with time running very short.The euro zone is doubtful that a deal will be struck with Greece next week on economic reforms for bailout funds. Both the Greek government and its creditors have expressed the need for an agreement, at least in outline, to be reached when euro zone finance ministers meet in the Latvian capital Riga on April 24. But Athens has yet to produce a programme of reforms that is deemed acceptable.....Greek drama shifts to Washington http://t.co/ucW3fl9mmy via @Reuters 8.40am BST Britain’s economy is also suffering from political drama. Housebuilder Persimmon has warned shareholders that it’s harder to find building sites ahead of May’s nailbiter of a general election. Election is stalling new house building, says Persimmon http://t.co/YGYYTh8xGoLatest YouGov poll (14 - 15 Apr): LAB - 35% (-) CON - 34% (+1) UKIP - 13% (-) LDEM - 8% (-) GRN - 5% (-) 8.32am BST Overnight, German finance minister Wolfgang Schäuble chastised Greece’s government for making promises it can’t deliver on.In remarks that are likely to irk Athens, Schäuble argued that Greece was doing better than expected - until the election three months ago. “I have told Prime Minister [Alexis] Tsipras, if you promised to your electors in campaigning that you will get recovery and stay within the euro zone without sticking to the program, you will suffer.” 8.17am BST The IMF/G20 Spring meeting is the main event in the financial world today, says Michael Hewson of CMC Markets.And with little in the economic calendar, Yanis Varoufakis’s brief meeting with president Obama will also get some attention. But it may not yield much for Greece, Hewson warns:Unfortunately for Mr Varoufakis, sympathy is probably the only thing he will receive in the wake of yesterday’s S&P downgrade of Greece to CCC+ with a negative outlook, and last week’s meeting between Greek Prime Minister Tsipras and Russian President Vladimir Putin.The new Greek government is slowly realising that when you’re trying to negotiate a deal with your creditors, it pays to at least try and generate some consensus and goodwill amongst some of them, and not cosy up to a Russian President who is probably not the most popular person amongst European and US officials at the moment. 8.06am BST Early action in the bond markets: German 10-year bunds are hitting fresh record highs again today, sending the interest rates on its debt down again.The 10-year bund yields has just fallen below 0.1% for the first time ever:10y Bunds at 0.099% 7.56am BST Mario Draghi can take a sigh of relief.Josephine Witt, the activist who disrupted his press conference yesterday with a shower of confetti and anti-ECB leaflets, has left Frankfurt.Bye, Bye, #ecb pic.twitter.com/fgDfRTpT4o 7.53am BST Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.“There’s no doubt that if this leads to a crisis such as Greece leaving the euro zone, it will cause an enormous amount of disruption and hardship in Greece,”“Even if the contagion risk is much less now than it was, say, in 2012 and earlier, it would not be a good thing in a world economy just recovering from a deep recession to have that kind of uncertainty introduced.”“No one has a clue how we can reach agreement on an ambitious programme.We have the next Eurogroup meeting at the end of the coming week, but nobody expects that there will be a solution.” Related: Greece at substantial risk of default, say experts Continue reading...
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