Highlights of Mario Draghi’s ECB press conference, as prime minister Tsipras heads to Brussels for crucial talks this eveningDraghi says ECB wants Greece to stay Summary: Tsipras on his way to BrusselsCreditors’ offer starts to leak...EC: Don’t expect a deal tonightGreek insider: “The fight isn’t over”Athens: No IMF repayment unless deal is close 3.01pm BST Tsipras proposals irreconcilable with Merkel's take-it-or-leave paper, says Brussels source. No common ground on fiscal aim #greece 2.59pm BST And here’s the Reuters take on Schaeble’s comments on the latest Greek proposals:German Finance Minister Wolfgang Schaeuble said on Wednesday that an initial look at Greece’s reform proposals to international lenders indicated that talks aimed at getting a deal to unlock cash for Athens will still take time. 2.56pm BST Meanwhile ECB president Mario Draghi’s comments at the bank’s press conference have send bond yields climbing.It appears to be Draghi saying he was willing to look through bond market volatility which is doing the damage. He said “one lesson is that we should get used to periods of higher volatility”, suggesting the ECB may not act every time the bond market moves sharply. 2.50pm BST French president François Hollande has joined in on Greece, saying “we are a few days or hours away from a possible deal.”According to Reuters, he added that “one should not ask too much of Greece so as not to stifle growth, but [one] cannot ask too little either.” 2.43pm BST Snap summary:Full #Draghi: - No QE exit discussion, no financial risk - Higher volatility? Get used to it! - No change of attitude vis-à-vis #Greece 2.36pm BST And finally, another question on Greece -- can Draghi please explain exactly what his vision of a “strong agreement” looks like?It should be strong in design and implementation, the ECB president replies.Some of the things discussed in previous months are clearly fiscally unsustainable.Draghi says when he says the agreement shd be "strong" he means strong in design and in implementation - ie, things done sooner than later"Strong agreement". Drink. #Gin @Berlaymonster 2.29pm BST Disappointing -- Draghi says he will not be dropping into the meeting between Alexis Tsipras and Jean-Claude Juncker tonight.Update: it’s not clear whether this means there won’t be any ECB presence..#grexit draghi's a royal we, as in 'we are not going to that meeting'. or no ecb at all with tsipras/juncker? 2.25pm BST German government debt price are falling sharply as Draghi speaks, pushing up the yield (interest rate) on 10-year bonds to 0.8%, the highest this year. German 10-year yield rises above 0.8% amid Draghi press conference. http://t.co/mJP44zUs7o pic.twitter.com/kGXYdcBclT 2.24pm BST How can the ECB claim to be a rules-based institution when it doesn’t impose tougher haircuts on Greek assets used as collateral, in response to the deterioration in the country’s financial sector? Aren’t you taking a political stance?It’s not true, Draghi replies. We are following the rules. 2.20pm BST Would the ECB be happy for Europe’s stability mechanism (the ESM) to buy the Greek bonds held by the Bank, which mature in July and August?(That would spare Athens from finding €6.7bn to repay the ECB) 2.17pm BST We’re getting a lot of questions on Greece in Frankfurt.Mario Draghi says that the ECB does “see the Greek economy as a viable economy”, so long as like all economies the right policies are being undertaken.Draghi: "I don't want to speculate on likelihood of these events". Question was on Greek default. #Greece 2.16pm BST Meanwhile, here’s some reaction from German finance minister Wolfgang Schaeuble on the Greek reforms, and it doesn’t look promising:SCHAEUBLE: OPTIMISM ON GREEK NEGOTIATION PROGRESS NOT JUSTIFIED* German Fin Min Schaeuble says first impression of Greek list of reforms confirms view that talks won't be over soon - RTRS 2.15pm BST Draghi fires another warning shot at Athens, saying the ECB will discuss the haircuts imposed on Greek bonds used as debt collateral at its next meeting. #ECB Draghi says GovCouncil will see situation on #Greece debt at next meeting; have been considering Greek debt haircuts on for a while.Perfectly nuanced threat to the Greek gov't by Draghi. 2.07pm BST Does the ECB have an exit strategy for its QE bond-buying programme?Draghi sweeps the idea aside, saying eurozone inflation is nowhere near high enough.Exit strategies are a high-class problem.. we’re not there yet. 2.06pm BST Why hasn’t Europe done a better job of fixing this crisis, rather than leaving us facing another make-or-break Greek meeting? Draghi explains that it’s a question of commitment: Many programmes have been designed. Some have been implemented. Others have not been implemented. 2.04pm BST Draghi declines to comment on the Greek negotiations while they are in a “state of flux”, but repeats that the ECB wants to see a strong agreement.That should include strong growth, social fairness, fiscal stability.... he adds. 2.00pm BST 1.59pm BST What’s the ECB’s take on the recent bond market volatility?Draghi explains that investors should get used to it; such volatility is inevitable at times of higher asset prices and very low interest rates, with growth and inflation picking up.#Draghi: we have to accept higher volatility.#Draghi on market correction: "one lesson is that we should get used to periods of higher volatility". My monetary policy - your problem. 1.56pm BST Draghi admits that the ECB had expected to see stronger signs of economic growth, although the recovery is proceeding as expected.#Draghi: "recovery is on track exactly according to our projections however we had expected stronger figures" + "slight loss of momentum" 1.55pm BST What about the prospect of Greece missing Friday’s IMF repayment?Draghi sounds unimpressed by this prospect, saying it has happened ‘once in the 1970s’.Draghi's Zambia monent. 1.52pm BST Draghi: precondition for Greek T-Bills, there shd be a credible perspective 4 a successful conclusion of current review + plus disbursement 1.52pm BST Another question on Greece -- what would it take for the ECB to raise the cap preventing Greek banks buying more short-term Greek government debt?Draghi: We’d need to see a disbursement of aid in order to consider whether to change the limit for Greek t-bills. #Draghi says #Greece bailout aid disbursement is pre-condition to lifting t-bill cap. That's a higher bar than most expected. 1.50pm BST #ECB's Draghi on Coeure leak: Soon to come out w/ new rules on speaking engagements. We're aware of code governing board appearances. 1.50pm BST Draghi admits that the ECB made a mistake when it didn’t release the text of a speech made by policymaker Benoit Coeure until the next morning. 1.47pm BST Onto questions -- and Claire Jones of the FT asks Draghi to comment on Monday night’s emergency mini-summit, which he attended.Negotiations are proceeding at this point in time, so there is no point on my commenting on various aspects, Both the Greek government and the institutions have proposals which they are consulting on.The governing council of the ECB wants Greece to stay in the euro, but there should be a strong agreement. One that creates growth, and which is fiscally sustainable and addresses the remaining sources of financial instability.This will be the component of a strong agreement. 1.42pm BST Draghi concludes his statement with his traditional call to arms.Politicians should be bold with structural reforms now, to help underpin growth, boost productivity, and encourage firms to invest. That way, the current cyclical recovery becomes self-reinforcing, rather than spluttering out. 1.41pm BST This is not a vintage performance from Mario Draghi, yet.People saying Draghi presser is boring. I prefer my central bankers boring and grey 1.38pm BST The ECB has revised its forecast for inflation higher this year, from 0% to 0.3%Draghi: Inflation projected to be at 0.3% in '15, 1.5% in '16 and 1.8% in '17 (March: 0%, 1.5%, 1.8%)Draghi: Annual real GDP projected to increase by 1.5% in '15, 1.9% in '16 and 2.0% in '17 (March: 1.5%, 1,9%, 2,1%) 1.35pm BST Draghi is explaining that the ECB is doing a rather good job:Draghi: Monetary policy has contributed to recovery in inflation expectations, better borrowing conditionsDraghi: Full implementation of all monetary policy measures will lead to sustained return of inflation rates towards 2% 1.34pm BST Draghi begins by confirming that the ECB left interest rates unchanged today, and says that the new asset-purchase programme (the QE scheme launched this year) is proceeding well.The governing council will “look through” fluctuations in inflation, and focus on the long-term trends, he adds, when setting policy. 1.31pm BST 1.29pm BST Right, time for a good lunch to watch the European Central Bank press conference. Expect Mario Draghi to discuss the state of the eurozone economy (getting better), and the Greek bailout crisis (getting rather exciting). 1.23pm BST A quick recap, before the European Central Bank’s press conference begins.Greece’s prime minister Alexis Tsipras is heading to Brussels for showdown talks with European Commission president Jean-Claude Juncker over a possible bailout deal.PM Tsipras says agreement with creditors will stop the Grexit scenario and will provide liquidity to #Greece https://t.co/4sJl6hDq1U“Today it is more expedient than ever for the institutions and the political leadership of Europe to accede to the realism with which the government has been moving for the past three months.”“We have to avoid division ... I am sure that the leadership of Europe will do what it has to.” It's showdown. #Greek PM #Tsipras airborne for #Brussels to meet @JunckerEU to discuss latest 2-way proposals @PrimeministerGR#Greece primary surplus proposals: 2015 Creditors 1%, Greek gov't 0.8% 2016 Cred 2%, Grk 1.5% 2017 Cred 3%, Grk ? 2018 Cred 3.5%, Grk ? 1.17pm BST Over to America briefly for the monthly ADP employment report.And it shows that 201,000 new private-sector jobs were created by US firms last month, broadly as expected.ADP 201k .... v 200k as expected.... prior reading revised 4k lower..... about as in line as it ever gets 1.13pm BST Last week: Greece "A deal is very close" EU: "No it isn't" Today: EU: "A deal is very close" Greece: "What deal?" 1.07pm BST Assuming the FT is right, there’s quite a gap between the creditors’ latest demands and Greece’s own primary surplus targets:#Greece primary surplus proposals: 2015 Creditors 1%, Greek gov't 0.8% 2016 Cred 2%, Grk 1.5% 2017 Cred 3%, Grk ? 2018 Cred 3.5%, Grk ?@plegrain @SpiegelPeter Even those lower primary surplus targets will be very hard to hit if the economy remains weak pic.twitter.com/zI403gcVHA 1.00pm BST Struggling to keep track of all Greece’s debt repayments in the weeks and months ahead?Here’s the solution - a handy widget showing the next demand, and all the other looming payments: 12.56pm BST The Athens stock market has jumped by 4% today, driven by optimism that a deal is close.Bank shares are leading the rally, pushing the main ATG index up by over 4% today.Traders particularly keen to learn the details of a last-ditch funding deal offer made by Athens’ creditors yesterday. 12.50pm BST Details of the offer being put to Greece are starting to emerge in Brussels.The FT’s Peter Spiegel says creditors have trimmed their demands for the primary budget surpluses Greece must run. But they still look too high for Greece’s liking.In addition to the 1 per cent surplus this year, Greece will be asked to hit a 2 per cent target next year, rising to 3 per cent in 2017 before getting to 3.5 per cent in 2018.Those numbers are significantly lower than the current bailout programme -- which called for a 3 per cent surplus this year rising quickly to 4.5 per cent next year. But it is also tougher than many in Athens had hoped.New details on creditors' #Greece proposal: 1% primary surplus in 2015; 2% in 2016; 3% in 2017; 3.5% in 2018 http://t.co/P0RLV9CvDw 12.47pm BST The European Central Bank has left its three interest rate unchanged, at its meeting in Frankfurt today.That means the benchmark rate is just 0.05%, and banks will have to pay a negative interest rate of -0.2% on deposits they leave in the ECB’s vaults. ECB leaves rates on hold. Main refi at 0.05, Deposit rate at -0.2% pic.twitter.com/q8PVlYx7PQ 12.33pm BST Over in Athens there is more fighting talk this morning from the ruling radical left Syriza party.“The Greek people know very well what the red lines of the Greek government are, they know very well what the Greek government hasn’t accepted in pension [reform] and labour relations and they know that that is what it is negotiating.” “In order for this to happen, the memorandum has to be put to an end once and for all.” “Important steps on our side have taken place, a wealth of proposals and reforms have been submitted. The necessary concessions for negotiations to end in agreement have happened, but as we have said from the beginning, we have limits that are defined by our mandate that the Greek people have given us. The negotiation has moved on two pivots: that we would respect the rules of the euro zone even if we disagree with them and our partners must respect the mandate of the Greek people.” 12.21pm BST 11.40am BST Curious.... EC spokesman Schinas is being cagey about whether eurogroup president Dijsselbloem will actually meet Alexis Tsipras tonight (as was reported earlier).As a mere finance minister (for the Netherlands), he’s a little below Tsipras’s pay grade....Juncker invitation to Tsipras is 'personal invitation', says @MargSchinas, declining to say whether @J_Dijsselbloem will attendAm told @J_Dijsselbloem invited to tonite's meeting w/@atsipras by @JunckerEU, but Tsipras not happy. No @Lagarde or #Draghi. 11.37am BST The European Commission’s top spokesman, Margaritis Schinas, has just confirmed that Juncker and Tsipras will meet tonight, to discuss the Greek crisis.He warned, though, that a deal is unlikely to be agreed today..@JunckerEU has invited @atsipras personally at 20:30 CET to discuss the state of play on #Greece. No final outcome expected tonight.EU's @MargSchinas says no final Greece deal expected from Juncker-Tsipras talks tonight 11.33am BST Alexis Tsipras just gave a brief speech on Greek television. He told the nation that he is heading to Brussels for talks with Jean-Claude Juncker, to encourage Europe’s leaders to “see reason”.Tsipras added that he has not yet received any information from creditors yet. More to follow....Tsipras: "I am certain Europe's leadership will see reason" #Greece pic.twitter.com/B3itNUItyO 11.25am BST The Economist’s Tom Nuttall reports that optimism is building in Brussels that a deal will be announced on Thursday:Senior commission official tells me "almost 100% certain" deal between Greece and institutions will be announced tomorrow.Syriza lawmakers meet tomorrow. Alexis has a hard sell ahead of him #Greece #Syriza 11.21am BST Tsakalotos, Pappas, and Sakellaridis will accompany PM Tsipras to Brussels to meet Juncker/Dijss. #Varoufakis will remain in Athens. #Greece 11.04am BST Spain’s finance minister, Luis de Guindos, has declared that a Greek deal will be reached in time.*GUINDOS FEELS `TOTALLY SURE' CREDITORS, GREECE WILL GET ACCORD 11.03am BST Tonight’s Newsnight could be a classic, given their economics editor is already swigging local spirits in the cause of journalism:"Interview some greek pensioners", I said.They're making @DuncanWeldon drink raki on the job. I am laughing nervously pic.twitter.com/xpFn6eCA5m 10.53am BST Tsipras’s trip to Brussels today isn’t great timing for UK journalists who have just jetted to Athens to report on the crisis.Both Sky News and Newsnight have sent crack teams over, anticipating some dramatic days ahead in Greece. Glad to see they’re being well looked after:Quick bit of tripod surgery for our cameraman Jamie from a friendly Athens hardware shop pic.twitter.com/Id7k92umjd 10.33am BST Dutch prime minister Mark Rutte has warned that Greece could yet leave the euro, and criticised Alexis Tsipras for making such optimistic promises in his journey to power.Speaking to Reuters in Paris, Rutte said:“You can never say it (“Grexit”) is not an option, but it is not the aim. The aim is to come to a common understanding.“I do believe they are working very hard to get somewhere, but at the same time they (the Greeks) have made so many promises in the elections and afterwards in parliament ... that it’s difficult to bridge the gap.” 10.31am BST Double dose of good news for the Eurozone with unemployment falling 130,000 in April and retail sales rising a robust 0.7% month-on-month. 10.08am BST Unemployment across the eurozone fell in April, but remains far too high in many members.Eurostat just reported that the jobless rate across the euro area dipped to 11.1%, down from 11.2% in March. That’s a three-year low.Euro area unemployment rate at 11.1% and EU at 9.7% in April 2015 #Eurostat http://t.co/jId2QphCYB pic.twitter.com/eMQTVapBbGEuro area retail trade +0.7% in Apr 15 over Mar 15, +2.2% over Apr 14 #Eurostat http://t.co/w0HLYRAyzk pic.twitter.com/B1yuq7MLjH 10.01am BST Greece’s economy will barely grow this month, and unemployment will be even higher than previously feared.That’s according to new forecasts from the Organisation for Economic Co-operation and Development this morning. OECD slashes Greek GDP growth estimate to 0.1% in 2015 (from 2.3% before) and to 2.3% in 2016 (from 3.3%). #Greece #OECD #economyOECD ups Greek debt/GDP forecast to 180% in 2015 (from 174.3% before) and to 178.1% in 2016 (from 171.4%). #Greece #OECDOECD increases Greek unemployment projection to 25.7% in 2015 (from 25.2% before) and to 24.7% in 2016 (from 24.1%). #Greece #OECD 9.48am BST The pound just took a tumble after the latest survey of Britain’s service sector missed forecasts.GBPUSD timberrrrrrrr pic.twitter.com/WJpQvQ5zPf 9.41am BST It’s official.... Eurogroup chief Jeroen Dijsselbloem is indeed attending tonight’s crunch meeting in Brussels. That means the eurozone’s finance ministers will have a presence as the leaders of Greece and the EC debate the crisis. So tonight's meeting in Brussels will include @J_Dijsselbloem, @JunckerEU, @atsipras and representatives of ECB and IMF. 9.33am BST Officials in Athens are calling the latest developments “the most crucial day” since the anti-austerity government launched negotiations with creditors in February.“The struggle for an honourable compromise is far from over. There are still red lines. This is about the future of Greece.”"So, the latest round of talks between #Greece and its creditors is on track?" pic.twitter.com/bljmGNvHhW 9.21am BST Rumour watch: Jeroen Dijsselbloem, the head of the eurogroup (eurozone finance ministers) is planning to meet Alexis Tsipras tonight too, according to Bloomberg.*DIJSSELBLOEM SAID TO MEET TSIPRAS IN BRUSSELS TONIGHT 9.16am BST Back in Greece, speculation about a snap election is rife.Dat awkward moment when election-rumors are dominating almost every discussion in TV, cafeterias, workspace & your Facebook inbox. #Greece 9.15am BST Good news from Italy; the unemployment rate fell to 12.4% in April, down from 12.6% in March (which was revised down from 13%). With Italy now finally returning to growth this year, there are signs that its lacklustre economy is picking up. Still a long way to go, though. 9.08am BST Here comes the first gobbet of economic data....and it shows that growth across Europe’s private sector slowed a little in May.Markit’s Eurozone Composite Output Index fell to 53.6, down from 53.9 in April, meaning the sector expanded at a slower rate. That suggests the long deadlock over Greece may have sapped confidence.“The Eurozone recovery lost some of the wind from its sails in May, with growth of output and new orders both slowing to three-month lows. “The weak euro is boosting manufacturing and households are benefitting from lower inflation, but the region’s high unemployment continues to limit spending on goods and services. Heightened uncertainty surrounding the Greek debt crisis is also acting as a brake on growth.” 9.00am BST If a deal is reached, then Greek public relief could cushion the blow of making painful concessions, argues George Pagoulatos, professor of European politics and economy at the Athens University of Economics and Business.He told Bloomberg that:“The need for a deal is so big, after such a prolonged liquidity crunch, that the relief for the wider public will eventually trump the cost of compromise.”No debt relief for #Greece? Hard to be optimistic after this important story from @nchrysoloras @bjennen1 @corinaruhe http://t.co/bw9Z0LS8jC 8.49am BST We also don’t know much about the rival proposal which Greece has drawn up, and which Alexis Tsipras will take to Brussels today.But Greek newspaper Kathimerini believes it raises less revenue than lenders demand, and also takes a more gentle approach to pension and labour reform:According to sources, it proposes a low primary surplus target for this year of between 0.3% and 0.8% of gross domestic product as well as retaining three value-added tax rates – at 6%, 11% and 23% – but varying the goods and services assigned to each rate. But the Greek proposal for VAT foresees €1bn in revenue being raised, around half of the creditors’ desired target. 8.40am BST We don’t yet know what’s in the creditors’ proposals. But the Financial Times believes it may include more onerous budget targets than Greece would like:It could require Greece to achieve primary budget surpluses — revenues less expenses when debt interest payments are not included — of as much as 3.5% of gross domestic product in the medium term. Athens has demanded a much lower level.Another person briefed on the plan said the latest proposals remained closer to the IMF’s stance in several important areas — including requiring Greece to keep its pension fund from running a deficit — than the commission’s more lenient views. 8.21am BST Greek bonds are rallying a little this morning, as the City shows confidence that a deal will be reached.The yield on Greece’s benchmark 10-year debt has fallen to 11.2%, from 11.35% last night. That shows the bonds are seen as less risky (although still unsuitable for widows and orphans).#Greece will not pay #IMF on Fri w/o prospect of a deal. Mkts more confident, 2yr yield drops. http://t.co/P83qJ3uy5I pic.twitter.com/IJhdHC3tyD 8.15am BST France’s economy minister, Emmanuel Macron, has predicted success in the talks between Greece and the creditors: 8.11am BST Greek government spokesman Nikos Filis has raised the states this morning, warning that Greece won’t repay €305m to the IMF on Friday unless it believes a deal is close.“If there is no prospect of a deal by Friday or Monday, I don’t know by when exactly, we will not pay.”If after two weeks the debt still hasn’t been repaid, IMF’s management make a direct appeal to Greek finance minister Yanis Varoufakis or his alternate, Yannis Stournaras, making it clear how serious the situation is. 7.56am BST Good morning. It’s going to be a big day for Greece, and the eurozone.Efforts to agree a package of economic reforms will step up another gear, as Greece’s three main creditors submit their proposal to break the deadlock.The Greek prime minister, Alexis Tsipras, will be presented with what is expected to be a take-it-or-leave-it plan on Wednesday after five months of drama-filled negotiations to keep his debt-stricken country afloat.“It covers all key policy areas and reflects the discussions of recent weeks,” a senior EU official said on Tuesday. “It will be discussed with Tsipras tomorrow.”“The prime minister will be in Brussels tomorrow with the Greek proposal in his luggage.” Related: Alexis Tsipras to face take-it-or-leave-it ultimatum from lenders over debt offer Not sure everyone in Athens agrees #Greece pic.twitter.com/g0lIbINc7zToday sees the release of Eurozone, UK, US Services PMI, ECB Rate Decision, US ADP Employment Change, Trade Balance, ISM Non-Manf., DoEs! Continue reading...
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