Greek Economy Facing Downfall As Country Faces Important Bond Auction
The economy of Greece has plunged in more deeper into the problem of recession according
to the official figures, which has now raised tension over the sum of money which is 3.1 billion Euros that equals to 2.4 pounds, that Athens needs to raise on the markets of the bond so that it can easily avoid defaulting on debt which is due on Monday.
The Gross Domestic Product that is the GDP of the country had shrank by 6.2 per cent year-on-year in the second quarter of 2012, that is in the last 6 months of the present year which was based on first estimates, that was underlining the chronic economic crisis since it is was very much hampering the ability of Greece to pay its debts which it was facing. In its biggest auction for the month, Athens has planned to put an auction which is worth 3.1 billion Euros in three-month bills in order to meet the deadline of the repayment of a 3.7 billion euro loan from the European Central Bank that is ECB.
This very auction is being watched as an indication of the level of the support for Greece which it is going to go ahead of a make-or-break few months for the euro zone. It comes amidst the tough warnings from the side of Germany that Athens must honor its bond agreements of facing ejection from the euro zone. A spokesman of the European Commission had to say that they are not much worried. According to their information the T-bill issuance is fully under control and there is not much of a problem.
Raoul Ruparel who is the head of research at Open Europe was of the view that the money which is being raised is largely going to go straight to the banks of the Greece and thus they are expecting that the markets of the bond should be happy with this event. But the idea of making the repayment of long-term debt with short-term debt is not an ideal thing or even sustainable for Greece as it is just going to take up the costs of financing of the country. The kind of situation which it is facing, Greece needs a proper solution to handle it at the earliest. Apply now with text loans @ http://www.textloanlenders.org.uk/text-loans.html & get quick cash aid via top text loan lenders @ http://www.textloanlenders.org.uk/ now
The Fresh data shows that the ECB has axed its funding to the banks of Greece by a sum of 49.67 billion Euros to just 23.99 billion Euros in the month if July from the month of June leaving the Greek central bank to provide emergency liquidity at its place.