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| Greek debt crisis: Greece begins repaying ECB and IMF as banks reopen - as it happened | Greek debt crisis: Greece begins repaying ECB and IMF as banks reopen - as it happened |
| (6 months later) | |
| 6.06pm BST | |
| 18:06 | |
| Closing summary: Greece re-opens banks and pays off some debts | Closing summary: Greece re-opens banks and pays off some debts |
| Our main story tonight: Greece has taken a step back to normality after its banks reopened following three weeks of closures and receipt of a €7.2bn (£5bn) loan, with almost all of it spent on repaying debts. | Our main story tonight: Greece has taken a step back to normality after its banks reopened following three weeks of closures and receipt of a €7.2bn (£5bn) loan, with almost all of it spent on repaying debts. |
| Related: Greece reopens banks and pays off some debt in first steps towards normality | Related: Greece reopens banks and pays off some debt in first steps towards normality |
| After a quieter day by recent eurozone standards, a closing summary before we go: | After a quieter day by recent eurozone standards, a closing summary before we go: |
| Bank branches across Greece have reopened today, as the financial restrictions that have constrained the country for the last three weeks are relaxed, a little, following last week’s bailout deal. | Bank branches across Greece have reopened today, as the financial restrictions that have constrained the country for the last three weeks are relaxed, a little, following last week’s bailout deal. |
| Queues formed early at branches in Athens and Thessaloniki, but there were no reports of panic. In Athens, our correspondent Helena Smith reports that bank officials were, in fact, surprised at how quiet it was. | Queues formed early at branches in Athens and Thessaloniki, but there were no reports of panic. In Athens, our correspondent Helena Smith reports that bank officials were, in fact, surprised at how quiet it was. |
| The banking sector is still subject to capital controls, which mean people can’t withdraw more than €420 per week from their accounts, or transfer money overseas. Here’s a list of the restrictions. | The banking sector is still subject to capital controls, which mean people can’t withdraw more than €420 per week from their accounts, or transfer money overseas. Here’s a list of the restrictions. |
| Greek shareholders aren’t allowed to buy or sell stock today, as the Athens exchange remains closed. It may open later this week. | Greek shareholders aren’t allowed to buy or sell stock today, as the Athens exchange remains closed. It may open later this week. |
| The European Commission sent a $7.2bn bridge loan to Greece today; the money was used to repay a maturing debt repayment owed to the ECB, and to cover outstanding bills to the IMF. The IMF confirmed Greece has now cleared its arrears with the fund. | The European Commission sent a $7.2bn bridge loan to Greece today; the money was used to repay a maturing debt repayment owed to the ECB, and to cover outstanding bills to the IMF. The IMF confirmed Greece has now cleared its arrears with the fund. |
| Last week’s austerity measures are already hitting Greeks, who are now paying higher VAT rates on many basic goods. | Last week’s austerity measures are already hitting Greeks, who are now paying higher VAT rates on many basic goods. |
| The IMF has announced that Maurice Obstfeld, an expert on optimal currency unions, will take over from retiring chief economist Olivier Blanchard. | The IMF has announced that Maurice Obstfeld, an expert on optimal currency unions, will take over from retiring chief economist Olivier Blanchard. |
| On financial markets, European share indices have risen as Greek worries recede, yields on Italian, Portuguese and Spanish government bonds have fallen and safe-haven favourite gold has sold off sharply. | On financial markets, European share indices have risen as Greek worries recede, yields on Italian, Portuguese and Spanish government bonds have fallen and safe-haven favourite gold has sold off sharply. |
| Thanks for reading and all the comments. We will be back in the morning with the latest economic and business news from the UK, the eurozone and beyond. | Thanks for reading and all the comments. We will be back in the morning with the latest economic and business news from the UK, the eurozone and beyond. |
| 5.43pm BST | |
| 17:43 | |
| On a day when the Greek banks opened their doors for the first time inthree weeks, the debate about future funding needs seems far away.But our economics correspondent Phillip Inman asks what lies ahead for Greece’s battered financial sector. | On a day when the Greek banks opened their doors for the first time inthree weeks, the debate about future funding needs seems far away.But our economics correspondent Phillip Inman asks what lies ahead for Greece’s battered financial sector. |
| He writes: | He writes: |
| Plenty of dangers lie in wait for Greek banks. Already short of cash, they may need lots more when stress tests of their solvency are carried out in a month or two. | Plenty of dangers lie in wait for Greek banks. Already short of cash, they may need lots more when stress tests of their solvency are carried out in a month or two. |
| And unable to access the international money markets, they will be in a similar position to the Greek god Telephus, who was wounded by Achilles and yet needed Achilles to return as a doctor before he could be healed. The Greek banks, stripped of many of their assets by the European Central Bank, will need the ECB to make a re-appearance in Athens to aid their recovery... | And unable to access the international money markets, they will be in a similar position to the Greek god Telephus, who was wounded by Achilles and yet needed Achilles to return as a doctor before he could be healed. The Greek banks, stripped of many of their assets by the European Central Bank, will need the ECB to make a re-appearance in Athens to aid their recovery... |
| A couple of months from now, the story could take a grim turn. Not only will hundreds of millions of deposits have been withdrawn in that time, the weakening effects of a broader economic slowdown will have taken their toll. | A couple of months from now, the story could take a grim turn. Not only will hundreds of millions of deposits have been withdrawn in that time, the weakening effects of a broader economic slowdown will have taken their toll. |
| The full analysis from Phillip: | The full analysis from Phillip: |
| Related: Greek banks face stress tests at the worst time | Related: Greek banks face stress tests at the worst time |
| 5.27pm BST | |
| 17:27 | |
| European stock markets have closed higher as worries about Greece recede. | European stock markets have closed higher as worries about Greece recede. |
| The main share indices have not managed to hold on to all their early gains but are still well within positive territory. | The main share indices have not managed to hold on to all their early gains but are still well within positive territory. |
| The Italian FTSE MIB has lead the way, up more than 1.1%: | The Italian FTSE MIB has lead the way, up more than 1.1%: |
| On government bond markets, the ebbing away of Grexit fears has also helped bring down yields in Southern Europe. Yields on Portuguese, Spanish and Italian 10-year government bonds are all lower. | On government bond markets, the ebbing away of Grexit fears has also helped bring down yields in Southern Europe. Yields on Portuguese, Spanish and Italian 10-year government bonds are all lower. |
| Of course, the big move on financial markets today, as reported earlier, has been in the old safe-haven favourite: gold. | Of course, the big move on financial markets today, as reported earlier, has been in the old safe-haven favourite: gold. |
| The gold price fell to its lowest for more than five years as the precious metal was buffeted by the deal to avert a Greek bankruptcy, a potential US interest rate increase and a sharp sell-off in China. It has since rebounded from a low of $1,088.05. | The gold price fell to its lowest for more than five years as the precious metal was buffeted by the deal to avert a Greek bankruptcy, a potential US interest rate increase and a sharp sell-off in China. It has since rebounded from a low of $1,088.05. |
| Laith Khalaf, senior analyst at Hargreaves Lansdown comments: | Laith Khalaf, senior analyst at Hargreaves Lansdown comments: |
| Gold has struggled against a backdrop of global economic recovery and a strengthening dollar, and the recent sell-off appears to have come on the back of the Chinese central bank reporting its gold holdings, which disappointed analyst’s expectations. | Gold has struggled against a backdrop of global economic recovery and a strengthening dollar, and the recent sell-off appears to have come on the back of the Chinese central bank reporting its gold holdings, which disappointed analyst’s expectations. |
| The yellow metal is traditionally seen as a store of value and a protection policy against catastrophe, both attractive features in recent years given the depth of the financial crisis and the devaluation of fiat currencies by central bankers cranking the printing presses. However those worries have receded, and with them so has the gold price.” | The yellow metal is traditionally seen as a store of value and a protection policy against catastrophe, both attractive features in recent years given the depth of the financial crisis and the devaluation of fiat currencies by central bankers cranking the printing presses. However those worries have receded, and with them so has the gold price.” |
| Here is our news story on today’s sharp moves for gold: | Here is our news story on today’s sharp moves for gold: |
| Related: Gold falls to five-year low as fears ease over Greece | Related: Gold falls to five-year low as fears ease over Greece |
| 4.44pm BST | |
| 16:44 | |
| Helena Smith | Helena Smith |
| Helena Smith has also been in the vaults of the Bank of Greece talking to Ioannis Zafeiropoulos, who has oversight of some 7,500 safety deposit boxes – held behind iron bars and huge steel doors. She reports: | Helena Smith has also been in the vaults of the Bank of Greece talking to Ioannis Zafeiropoulos, who has oversight of some 7,500 safety deposit boxes – held behind iron bars and huge steel doors. She reports: |
| An official at the bank for the past 31 years,Zafeiropoulos had spent 10 days drawing up a contingency plan. His worry: that once the banks reopened, the vaults might be stormed by savers fearing the country’s enforced ejection from the euro zone. | An official at the bank for the past 31 years,Zafeiropoulos had spent 10 days drawing up a contingency plan. His worry: that once the banks reopened, the vaults might be stormed by savers fearing the country’s enforced ejection from the euro zone. |
| “How was I going to cope when no more than four people can be in a vault at the same time?” he asked. “I had to devise a plan but instead of 3,000 people turning up as I had thought we’ve had less than a hundred. We’ve been joking about how disappointing it’s been.” | “How was I going to cope when no more than four people can be in a vault at the same time?” he asked. “I had to devise a plan but instead of 3,000 people turning up as I had thought we’ve had less than a hundred. We’ve been joking about how disappointing it’s been.” |
| All morning, he said, he had been asking himself why. | All morning, he said, he had been asking himself why. |
| “People have behaved so responsibly, so maturely today,” said Zafeiropoulos. “And I think that’s because they have probably said ‘now that the banks have opened, they are not going to close again and what on earth will I do with the contents of a safety box? Where will I hide my money or my jewels if I do take them out?’” he murmured. | “People have behaved so responsibly, so maturely today,” said Zafeiropoulos. “And I think that’s because they have probably said ‘now that the banks have opened, they are not going to close again and what on earth will I do with the contents of a safety box? Where will I hide my money or my jewels if I do take them out?’” he murmured. |
| “This crisis is never going to end. Do the sums, see how much they say we owe them,” he said referring to the EU, ECB and IMF that have kept the country afloat “and you’ll understand it will not be ending anytime soon.” | “This crisis is never going to end. Do the sums, see how much they say we owe them,” he said referring to the EU, ECB and IMF that have kept the country afloat “and you’ll understand it will not be ending anytime soon.” |
| 4.32pm BST | |
| 16:32 | |
| Helena Smith | Helena Smith |
| The reopening of Greek banks may have been highly symbolic for the crisis-hit country’s economy but in many ways today has defied expectations. Our correspondent Helena Smith reports from Athens. | The reopening of Greek banks may have been highly symbolic for the crisis-hit country’s economy but in many ways today has defied expectations. Our correspondent Helena Smith reports from Athens. |
| The opening of Greek banks on Monday was not without symbolism. After 21 days of being firmly closed, the sight of their shutters going up was uplifting both for Greeks and their debt-stricken economy - an economy that with the added restriction of capital controls has suffered immeasurable damage in the meantime. | The opening of Greek banks on Monday was not without symbolism. After 21 days of being firmly closed, the sight of their shutters going up was uplifting both for Greeks and their debt-stricken economy - an economy that with the added restriction of capital controls has suffered immeasurable damage in the meantime. |
| “What economy can work without its banks?” asked Spyros Kouroumbiotis, a pensioner in the queue at the Bank of Greece waiting to pay his taxes. “As an economist I still help family with their business and I can tell you it’s been a huge ordeal. Exports have stopped, imports have stopped, nothing has worked because it’s been impossible to pay anyone.” | “What economy can work without its banks?” asked Spyros Kouroumbiotis, a pensioner in the queue at the Bank of Greece waiting to pay his taxes. “As an economist I still help family with their business and I can tell you it’s been a huge ordeal. Exports have stopped, imports have stopped, nothing has worked because it’s been impossible to pay anyone.” |
| But on Monday it was the manner of their re-opening that surprised officials most. Quite quickly it became evident that the panic-stricken deluge of branches many had feared was simply not happening. Greeks, who have spent the best part of five years internalising the crisis – of getting used to bad news – had reacted with their feet: they had stayed home. And those who hadn’t were willing to stand in neat orderly queues, motivated to large degree by the desire to keep up with annual taxes and utility bills. | But on Monday it was the manner of their re-opening that surprised officials most. Quite quickly it became evident that the panic-stricken deluge of branches many had feared was simply not happening. Greeks, who have spent the best part of five years internalising the crisis – of getting used to bad news – had reacted with their feet: they had stayed home. And those who hadn’t were willing to stand in neat orderly queues, motivated to large degree by the desire to keep up with annual taxes and utility bills. |
| More from Helena later | More from Helena later |
| Updated | |
| at 4.34pm BST | |
| 3.54pm BST | |
| 15:54 | |
| Sticking with the IMF, the fund has just announced the successor to retiring chief economist Olivier Blanchard. Professor Maurice Obstfeld takes over the role of economic counsellor and director of the IMF’s research department in September, IMF managing director Christine Lagarde announces. | Sticking with the IMF, the fund has just announced the successor to retiring chief economist Olivier Blanchard. Professor Maurice Obstfeld takes over the role of economic counsellor and director of the IMF’s research department in September, IMF managing director Christine Lagarde announces. |
| Describing Blanchard’s successor, the IMF says: “A Professor of Economics (and former Chair of the Department of Economics) at the University of California, Berkeley, Obstfeld has advised many governments and consulted at central banks all over the world. He is currently serving as a member of President Obama’s Council of Economic Advisers, on leave from Berkeley.” | Describing Blanchard’s successor, the IMF says: “A Professor of Economics (and former Chair of the Department of Economics) at the University of California, Berkeley, Obstfeld has advised many governments and consulted at central banks all over the world. He is currently serving as a member of President Obama’s Council of Economic Advisers, on leave from Berkeley.” |
| Obstfeld is the co-author of two textbooks on international economics—Foundations of International Macroeconomics with former IMF Economic Counsellor Kenneth Rogoff, and International Economics with Paul Krugman and Marc Melitz. | Obstfeld is the co-author of two textbooks on international economics—Foundations of International Macroeconomics with former IMF Economic Counsellor Kenneth Rogoff, and International Economics with Paul Krugman and Marc Melitz. |
| Lagarde comments in a statement: | Lagarde comments in a statement: |
| “I am thrilled to have Maurice join us at the Fund. His outstanding academic credentials and extensive international experience make him exceptionally well placed to provide intellectual leadership to the IMF at this important juncture. He is known around the globe for his work on international economics and is considered one of the most influential macroeconomists in the world.” | “I am thrilled to have Maurice join us at the Fund. His outstanding academic credentials and extensive international experience make him exceptionally well placed to provide intellectual leadership to the IMF at this important juncture. He is known around the globe for his work on international economics and is considered one of the most influential macroeconomists in the world.” |
| “The position of Economic Counsellor is of fundamental importance to the IMF’s ability to provide its global membership with the best possible independent analysis and policy advice. I am confident that we have found an exceptional candidate in Maurice to take this work forward.” | “The position of Economic Counsellor is of fundamental importance to the IMF’s ability to provide its global membership with the best possible independent analysis and policy advice. I am confident that we have found an exceptional candidate in Maurice to take this work forward.” |
| Ferdinando Giugliano at the Financial Times notes that Obstfeld is an expert on optimal currency areas. The eurozone will give him plenty to get his teeth into | Ferdinando Giugliano at the Financial Times notes that Obstfeld is an expert on optimal currency areas. The eurozone will give him plenty to get his teeth into |
| Maurice Obstfeld,the IMF's new chief economist, is an expert of optimal currency areas.His 2013 views on the eurozone pic.twitter.com/PEghuNUOjL | Maurice Obstfeld,the IMF's new chief economist, is an expert of optimal currency areas.His 2013 views on the eurozone pic.twitter.com/PEghuNUOjL |
| You can read more about Obstfeld on his homepage, where there are links to his recent papers, including on the eurozone, like this one on “some lessons of the euro crisis”. | You can read more about Obstfeld on his homepage, where there are links to his recent papers, including on the eurozone, like this one on “some lessons of the euro crisis”. |
| Updated | |
| at 4.12pm BST | |
| 3.38pm BST | |
| 15:38 | |
| Further to that statement from the IMF on Greece no longer being in arrears to the Fund, as a refresher when the country missed a €1.6bn payment on 30 June it became the first developed country to default to the IMF. It joined a club that includes Zimbabwe, Somalia and Sudan, which have all fallen into arrears with the fund. | Further to that statement from the IMF on Greece no longer being in arrears to the Fund, as a refresher when the country missed a €1.6bn payment on 30 June it became the first developed country to default to the IMF. It joined a club that includes Zimbabwe, Somalia and Sudan, which have all fallen into arrears with the fund. |
| Until that point no missed payment had been more than £890m (€1.3bn). So Greece’s missed payment of €1.6bn was bigger than any previous case of arrears. | Until that point no missed payment had been more than £890m (€1.3bn). So Greece’s missed payment of €1.6bn was bigger than any previous case of arrears. |
| But it was short-lived and Greek officials had already said earlier today that a €2.05bn payment to the Washington-based fund was underway, representing two missed payments – that €1.6bn and another smaller one that followed in July. As just reported, the IMF says the money has now been paid back. | But it was short-lived and Greek officials had already said earlier today that a €2.05bn payment to the Washington-based fund was underway, representing two missed payments – that €1.6bn and another smaller one that followed in July. As just reported, the IMF says the money has now been paid back. |
| Now Greece has cleared its arrears at the IMF, it is entitled to more loans from the fund. | Now Greece has cleared its arrears at the IMF, it is entitled to more loans from the fund. |
| 3.27pm BST | |
| 15:27 | |
| IMF confirms Greek repayment | IMF confirms Greek repayment |
| The International Monetary Fund (IMF) has just issued a brief statement confirming Greece has repaid its arrears to the fund, as had been expected after Greece got a bridging loan to cover its most pressing debts. | The International Monetary Fund (IMF) has just issued a brief statement confirming Greece has repaid its arrears to the fund, as had been expected after Greece got a bridging loan to cover its most pressing debts. |
| Gerry Rice, the IMF’s director of communications says: | Gerry Rice, the IMF’s director of communications says: |
| “I can confirm that Greece today repaid the totality of its arrears to the IMF, equivalent to SDR 1.6 billion (about €2.0bn). Greece is therefore no longer in arrears to the IMF. | “I can confirm that Greece today repaid the totality of its arrears to the IMF, equivalent to SDR 1.6 billion (about €2.0bn). Greece is therefore no longer in arrears to the IMF. |
| “As we have said, the Fund stands ready to continue assisting Greece in its efforts to return to financial stability and growth.” | “As we have said, the Fund stands ready to continue assisting Greece in its efforts to return to financial stability and growth.” |
| 3.06pm BST | |
| 15:06 | |
| Back to the main events in the eurozone now and our reporter in Brussels, Jennifer Rankin, has been looking at Greece’s ‘now you see it, now you don’t’ bridging loan. | Back to the main events in the eurozone now and our reporter in Brussels, Jennifer Rankin, has been looking at Greece’s ‘now you see it, now you don’t’ bridging loan. |
| She reports: | She reports: |
| The Greek money merry-go-round carries on in full swing as Athens received a €7.2bn (£5bn) loan from the EU and immediately spent almost all of it on repaying debts. | The Greek money merry-go-round carries on in full swing as Athens received a €7.2bn (£5bn) loan from the EU and immediately spent almost all of it on repaying debts. |
| Greek officials confirmed on Monday they had begun paying back international lenders, not long after the emergency bridging loan arrived in the Greek government’s bank account. | Greek officials confirmed on Monday they had begun paying back international lenders, not long after the emergency bridging loan arrived in the Greek government’s bank account. |
| The EU agreed the loan on Friday to enable Athens to meet urgent debt repayments and clear arrears, both necessary hurdles if the Greek government is to get a three-year bailout worth up to €86bn. | The EU agreed the loan on Friday to enable Athens to meet urgent debt repayments and clear arrears, both necessary hurdles if the Greek government is to get a three-year bailout worth up to €86bn. |
| Greece’s bank branches are open for the first time in three weeks, but capital controls still stop people from withdrawing more than €420/week. | Greece’s bank branches are open for the first time in three weeks, but capital controls still stop people from withdrawing more than €420/week. |
| The full story: | The full story: |
| Related: Greece pays off some debt as emergency loan arrives in Athens | Related: Greece pays off some debt as emergency loan arrives in Athens |
| Jennifer also shares a possible hint of missing all those eurogroup meetings. Be careful what you wish for.... | Jennifer also shares a possible hint of missing all those eurogroup meetings. Be careful what you wish for.... |
| Just realised this is my fifth week in Brussels, but only the first w/o a eurogroup. | Just realised this is my fifth week in Brussels, but only the first w/o a eurogroup. |
| Updated | |
| at 3.17pm BST | |
| 2.52pm BST | |
| 14:52 | |
| FT up for sale? | FT up for sale? |
| Regular readers of this blog will have become very familiar with the Financial Times’ excellent reporters in the field who have covered the Greek crisis tirelessly in recent months. News is just breaking that their pink paper could be moving to new owners. | Regular readers of this blog will have become very familiar with the Financial Times’ excellent reporters in the field who have covered the Greek crisis tirelessly in recent months. News is just breaking that their pink paper could be moving to new owners. |
| Bloomberg reports that owner of the FT, UK-listed Pearson, is “exploring a sale of the Financial Times after receiving interest from potential buyers, according to people familiar with the matter.” | Bloomberg reports that owner of the FT, UK-listed Pearson, is “exploring a sale of the Financial Times after receiving interest from potential buyers, according to people familiar with the matter.” |
| Bloomberg says Pearson is sounding out possible bidders and a sale may value the business at as much as £1bn. | Bloomberg says Pearson is sounding out possible bidders and a sale may value the business at as much as £1bn. |
| The full Bloomberg story is here. | The full Bloomberg story is here. |
| Meanwhile the FT’s Brussels bureau chief Peter Spiegel has this take on report. | Meanwhile the FT’s Brussels bureau chief Peter Spiegel has this take on report. |
| For an extra couple million, I'll throw in my troika report collection https://t.co/LlV4b60X3g | For an extra couple million, I'll throw in my troika report collection https://t.co/LlV4b60X3g |
| That £1bn price in the Bloomberg story, incidentally, is the same the number speculated on by analysts back in 2012 when talk swirled of a FT sale by Pearson. | That £1bn price in the Bloomberg story, incidentally, is the same the number speculated on by analysts back in 2012 when talk swirled of a FT sale by Pearson. |
| 2.20pm BST | |
| 14:20 | |
| Turning to the UK briefly, the wave of rate hike remarks from Bank of England policymakers last week, have kept the pound strong today. | Turning to the UK briefly, the wave of rate hike remarks from Bank of England policymakers last week, have kept the pound strong today. |
| After BoE governor Mark Carney signalled that the first rise in interest rates since the global financial crash could take place around the turn of the year, traders have been re-positioning themselves to price in the chances of a hike before 2016. | After BoE governor Mark Carney signalled that the first rise in interest rates since the global financial crash could take place around the turn of the year, traders have been re-positioning themselves to price in the chances of a hike before 2016. |
| That is good news for British holidaymakers jetting off abroad, whose pounds will now stretch further. It is not so welcome, however, for UK exporters given they had already been reporting pressure from a strong pound, given it makes UK goods more expensive to overseas buyers. | That is good news for British holidaymakers jetting off abroad, whose pounds will now stretch further. It is not so welcome, however, for UK exporters given they had already been reporting pressure from a strong pound, given it makes UK goods more expensive to overseas buyers. |
| Today the pound is weaker against the euro but at €1.4338 still not far off a seven-and-a-half year high hit on Friday. | Today the pound is weaker against the euro but at €1.4338 still not far off a seven-and-a-half year high hit on Friday. |
| Against a trade-weighted basket used by the BoE, the pound is also near last week’s seven-and-a-half year high. | Against a trade-weighted basket used by the BoE, the pound is also near last week’s seven-and-a-half year high. |
| 1.30pm BST | |
| 13:30 | |
| Summary: Greece takes a step towards normality | Summary: Greece takes a step towards normality |
| A quick recap. | A quick recap. |
| Bank branches across Greece have reopened today, as the financial restrictions that have constrained the country for the last three weeks are relaxed, a little, following last week’s bailout deal. | Bank branches across Greece have reopened today, as the financial restrictions that have constrained the country for the last three weeks are relaxed, a little, following last week’s bailout deal. |
| Queues formed early at branches in Athens and Thessaloniki, but there were no reports of panic. | Queues formed early at branches in Athens and Thessaloniki, but there were no reports of panic. |
| That’s partly because the banking sector is still subject to capital controls, which mean people can’t withdraw more than €420 per week from their accounts, or transfer money overseas. Here’s a list of the restrictions. | That’s partly because the banking sector is still subject to capital controls, which mean people can’t withdraw more than €420 per week from their accounts, or transfer money overseas. Here’s a list of the restrictions. |
| Greek shareholders aren’t allowed to buy or sell stock today, as the Athens exchange remains closed. It may open later this week. | Greek shareholders aren’t allowed to buy or sell stock today, as the Athens exchange remains closed. It may open later this week. |
| The European Commission is sending a $7.2bn bridge loan to Greece today; the money is being used to repay a maturing debt repayment owed to the ECB, and to cover outstanding bills to the IMF. | The European Commission is sending a $7.2bn bridge loan to Greece today; the money is being used to repay a maturing debt repayment owed to the ECB, and to cover outstanding bills to the IMF. |
| Last week’s austerity measures are already hitting Greeks, who are now paying higher VAT rates on many basic goods. | Last week’s austerity measures are already hitting Greeks, who are now paying higher VAT rates on many basic goods. |
| European stock markets have risen this morning, with the main indices up around 1% in a fairly quiet trading session. Greek fears have receded, for the moment at least. | European stock markets have risen this morning, with the main indices up around 1% in a fairly quiet trading session. Greek fears have receded, for the moment at least. |
| 12.24pm BST | |
| 12:24 | |
| Greece’s finance minister, Euclid Tsakalotos, has said farewell to one deputy this lunchtime, and welcomed another. | Greece’s finance minister, Euclid Tsakalotos, has said farewell to one deputy this lunchtime, and welcomed another. |
| Nadia Valavani (the outgoing deputy fin. min.) resigned last week in protest at Greece’s new bailout programme, and is being replaced by Tryfon Alexiadis: | Nadia Valavani (the outgoing deputy fin. min.) resigned last week in protest at Greece’s new bailout programme, and is being replaced by Tryfon Alexiadis: |
| Alexiadis had better hit the ground running, as the Greek government must pass a second set of austerity measures later this week (probably on Wednesday night). | Alexiadis had better hit the ground running, as the Greek government must pass a second set of austerity measures later this week (probably on Wednesday night). |
| Updated | |
| at 12.40pm BST | |
| 12.02pm BST | |
| 12:02 | |
| Here’s a technical explanation of how Greece’s new bridge loan will work (thanks to Katy Lee of AFP) | Here’s a technical explanation of how Greece’s new bridge loan will work (thanks to Katy Lee of AFP) |
| European Commission confirms $7.16 bn loan paid to Greece so they can now pay ECB & IMF (see gif for explanation) pic.twitter.com/3xxPq6pU1F | European Commission confirms $7.16 bn loan paid to Greece so they can now pay ECB & IMF (see gif for explanation) pic.twitter.com/3xxPq6pU1F |
| Updated | |
| at 12.05pm BST | |
| 11.44am BST | |
| 11:44 | |
| The EC’s chief spokesman, Margaritis Schinas, is fielding a few questions on Greece: | The EC’s chief spokesman, Margaritis Schinas, is fielding a few questions on Greece: |
| Asked about troika v institutions, commission spokesman says he wouldn't like "to become lost in terminology". #Greece | Asked about troika v institutions, commission spokesman says he wouldn't like "to become lost in terminology". #Greece |
| @Elbarbie Just referendums, I guess | @Elbarbie Just referendums, I guess |
| 11.33am BST | |
| 11:33 | |
| Greece gets bridge loan, and immediately spends it | Greece gets bridge loan, and immediately spends it |
| Greece won’t have much time to enjoy the €7bn bridge loan organised by the European Union last week. | Greece won’t have much time to enjoy the €7bn bridge loan organised by the European Union last week. |
| EU officials have just announced that this financing has been sent to Athens today, following several days of work by Brussels officials. | EU officials have just announced that this financing has been sent to Athens today, following several days of work by Brussels officials. |
| The €7.16bn bridge loan just sent to #Greece, says @Mina_Andreeva | The €7.16bn bridge loan just sent to #Greece, says @Mina_Andreeva |
| But over in the Greek capital, the money is already being spent to address Greece’s latest debt demands. | But over in the Greek capital, the money is already being spent to address Greece’s latest debt demands. |
| Government officials have confirmed that the process of repaying $4.2bn to the European Central Bank today has begun. That means Greece will avoid defaulting on its obligations to the ECB, which would have had very serious consequences. | Government officials have confirmed that the process of repaying $4.2bn to the European Central Bank today has begun. That means Greece will avoid defaulting on its obligations to the ECB, which would have had very serious consequences. |
| Greece also plans to clear its arrears to the International Monetary Fund, by sending €2.05bn over to Washington. That will cover the €1.6bn repayments due in June, which was missed as Greece staggered out of its previous bailout, plus a second payment due last week. | Greece also plans to clear its arrears to the International Monetary Fund, by sending €2.05bn over to Washington. That will cover the €1.6bn repayments due in June, which was missed as Greece staggered out of its previous bailout, plus a second payment due last week. |
| So in short, Greece’s creditors have loaned it more money, so it can repay its creditors. | So in short, Greece’s creditors have loaned it more money, so it can repay its creditors. |
| The cash spends hardly any time in Athens at all, before being yanked back out again. Maybe it should be renamed a bungee loan..... | The cash spends hardly any time in Athens at all, before being yanked back out again. Maybe it should be renamed a bungee loan..... |
| Commission confirms #Greece has received €7.2 bn bridge loan. Now money can go straight out the door to repay @ecb and other creditors. | Commission confirms #Greece has received €7.2 bn bridge loan. Now money can go straight out the door to repay @ecb and other creditors. |
| 11.06am BST | |
| 11:06 | |
| But while shares rally, the price of gold has hit its lowest level since early 2010: | But while shares rally, the price of gold has hit its lowest level since early 2010: |
| Related: Gold falls to five-year low as fears ease over Greece | Related: Gold falls to five-year low as fears ease over Greece |
| 11.04am BST | |
| 11:04 | |
| Europe’s stock markets are all up this morning, as worries over Greece recede. | Europe’s stock markets are all up this morning, as worries over Greece recede. |
| The Italian FTSE MIB is leading the way, up 1.5%, followed by Spain, France and Germany: | The Italian FTSE MIB is leading the way, up 1.5%, followed by Spain, France and Germany: |
| City experts appreciate that the Greek crisis isn’t over. | City experts appreciate that the Greek crisis isn’t over. |
| Connor Campbell, financial analyst at SpreadEx, explains: | Connor Campbell, financial analyst at SpreadEx, explains: |
| After a weekend (mercifully) free of big Eurozone drama, the semblance of normality returned this morning as the Greek banks opened for the first time in 3 weeks. | After a weekend (mercifully) free of big Eurozone drama, the semblance of normality returned this morning as the Greek banks opened for the first time in 3 weeks. |
| But there is a reason why these re-openings merely provide a surface level simulation of a working economy, not the real thing; capital controls remain in place, with the Greek public allowed only €420 a week (a marginal adjustment of the previous €60 a day) alongside a host of other restrictions. | But there is a reason why these re-openings merely provide a surface level simulation of a working economy, not the real thing; capital controls remain in place, with the Greek public allowed only €420 a week (a marginal adjustment of the previous €60 a day) alongside a host of other restrictions. |
| But rather than watching Athens and Brussels again, many traders are concentrating on events up at St Andrews: | But rather than watching Athens and Brussels again, many traders are concentrating on events up at St Andrews: |
| I blame #British weather for light newsflow, #TheOpen continues on Mon for first time since 1988, traders watching instead of trading #Golf | I blame #British weather for light newsflow, #TheOpen continues on Mon for first time since 1988, traders watching instead of trading #Golf |
| 10.44am BST | |
| 10:44 | |
| Greece’s factories was struggling even before capital controls were imposed at the end of June, new data shows. | Greece’s factories was struggling even before capital controls were imposed at the end of June, new data shows. |
| Turnover across the industrial sector shrank by 4.2% year-on year in May, according to stats body Elstat. | Turnover across the industrial sector shrank by 4.2% year-on year in May, according to stats body Elstat. |
| That follows a 4% annual decline in April, and a very serious slide at the start of the year: | That follows a 4% annual decline in April, and a very serious slide at the start of the year: |
| Elstat reports that mining and quarrying turnover slumped by 8.3%, while manufacturing turnover dropped by 4.2%. | Elstat reports that mining and quarrying turnover slumped by 8.3%, while manufacturing turnover dropped by 4.2%. |
| 9.57am BST | |
| 09:57 | |
| Krugman: I may have overestimated the competence of the Greek government..... | Krugman: I may have overestimated the competence of the Greek government..... |
| Quote of the Day goes to Paul Krugman, the Nobel Prize-winning economist. | Quote of the Day goes to Paul Krugman, the Nobel Prize-winning economist. |
| He’s admitted to CNN’s Fareed Zakaria that he didn’t anticipate that Alexis Tsipras wouldn’t have a Plan B, in case Greece’s creditors didn’t fold. | He’s admitted to CNN’s Fareed Zakaria that he didn’t anticipate that Alexis Tsipras wouldn’t have a Plan B, in case Greece’s creditors didn’t fold. |
| Krugman on assuming that Greece had an exit plan from the Euro: | Krugman on assuming that Greece had an exit plan from the Euro: |
| “…it didn’t even occur to me that they would be prepared to make a stand without having done any contingency planning ...amazingly - they thought they could simply demand better terms without having any backup plan. So certainly this is a shock. But, you know, in some sense, it’s hopeless in any case. …it’s not as if the terms that they were being offered before were feasible. I mean, the new terms are even worse, but the terms they were being offered before were still not going to work. So I, you know, I may have overestimated the competence of the Greek government.” | “…it didn’t even occur to me that they would be prepared to make a stand without having done any contingency planning ...amazingly - they thought they could simply demand better terms without having any backup plan. So certainly this is a shock. But, you know, in some sense, it’s hopeless in any case. …it’s not as if the terms that they were being offered before were feasible. I mean, the new terms are even worse, but the terms they were being offered before were still not going to work. So I, you know, I may have overestimated the competence of the Greek government.” |
| Krugman also believes that Greece will eventually leave the eurozone, unless it is granted “enormous” debt relief. | Krugman also believes that Greece will eventually leave the eurozone, unless it is granted “enormous” debt relief. |
| Paul Krugman on CNN: "I may have overestimated the competence of the Greek government" http://t.co/fwE2YZHpLU | Paul Krugman on CNN: "I may have overestimated the competence of the Greek government" http://t.co/fwE2YZHpLU |
| 9.33am BST | |
| 09:33 | |
| The re-opening of Greece’s banks appears to be operating smoothly, judging by this photo from a National Bank branch in Athens: | The re-opening of Greece’s banks appears to be operating smoothly, judging by this photo from a National Bank branch in Athens: |
| 9.17am BST | |
| 09:17 | |
| Today’s Greek VAT rise is the third since the country’s austerity programme began, five years ago: | Today’s Greek VAT rise is the third since the country’s austerity programme began, five years ago: |
| VAT on basic foodstuffs 2005: 8% 2006: 9% 2010: 11% 2011: 13% 2015: 23% Sharing the burden fairly & proportionately. https://t.co/zqlGhVSuGh | VAT on basic foodstuffs 2005: 8% 2006: 9% 2010: 11% 2011: 13% 2015: 23% Sharing the burden fairly & proportionately. https://t.co/zqlGhVSuGh |
| 9.08am BST | |
| 09:08 | |
| Greece's VAT rise hits customers | Greece's VAT rise hits customers |
| Greek consumers are facing higher prices today, as the sales tax hike demanded by its creditors is applied. | Greek consumers are facing higher prices today, as the sales tax hike demanded by its creditors is applied. |
| Sweeping VAT changes mean some food stuffs, restaurant meals and education services cost more. And even death (life’s other certainty alongside those taxes) will be more expensive: | Sweeping VAT changes mean some food stuffs, restaurant meals and education services cost more. And even death (life’s other certainty alongside those taxes) will be more expensive: |
| Associated Press has the details: | Associated Press has the details: |
| The VAT rose from 13% to 23%, making some meats, cooking oils other than olive oil, cocoa, vinegar, salt, flowers, firewood, fertilizer, insecticides, sanitary towels and other basics all more expensive. | The VAT rose from 13% to 23%, making some meats, cooking oils other than olive oil, cocoa, vinegar, salt, flowers, firewood, fertilizer, insecticides, sanitary towels and other basics all more expensive. |
| Services hit by the new VAT increases include restaurants and cafes, funeral parlors, taxis, cramming and tutorial schools very popular with Greek students seeking to make up for the deficiencies of the school system language institutes and computer learning centers. Public transport fares are expected to rise early next month. | Services hit by the new VAT increases include restaurants and cafes, funeral parlors, taxis, cramming and tutorial schools very popular with Greek students seeking to make up for the deficiencies of the school system language institutes and computer learning centers. Public transport fares are expected to rise early next month. |
| 8.47am BST | |
| 08:47 | |
| Greece 'gives order to repay ECB and IMF' | Greece 'gives order to repay ECB and IMF' |
| Bloomberg is reporting that Greece has spent almost all of the €7bn bridge loan hammered out by the eurozone on Friday. | Bloomberg is reporting that Greece has spent almost all of the €7bn bridge loan hammered out by the eurozone on Friday. |
| *GREECE SAID TO GIVE PAYMENT ORDER FOR EU 6.8BN TO CREDITORS, COVERS ECB, IMF, CENTRAL BANKS: FIN MIN OFFICIAL (Bloomberg) | *GREECE SAID TO GIVE PAYMENT ORDER FOR EU 6.8BN TO CREDITORS, COVERS ECB, IMF, CENTRAL BANKS: FIN MIN OFFICIAL (Bloomberg) |
| If so, Greece would have met today’s repayment to the European Central Bank, and covered its arrears to the International Monetary Fund (having missed two payments in recent weeks) | If so, Greece would have met today’s repayment to the European Central Bank, and covered its arrears to the International Monetary Fund (having missed two payments in recent weeks) |
| A bridge financing that'd be quickly spent. *GREECE SAID TO GIVE ORDER FOR EU6.8 BLN PAYMENTS TO CREDITORS; ECB, IMF, CEN BANK | A bridge financing that'd be quickly spent. *GREECE SAID TO GIVE ORDER FOR EU6.8 BLN PAYMENTS TO CREDITORS; ECB, IMF, CEN BANK |
| More to follow.... | More to follow.... |