Markets Tumble Greek Default Risk

Markets Tumble Greek Default Risk.

Markets Tumble 1.37% on Greek Emergency Account Access

Yet again stock markets in the UK and cross Europe have fallen on news that a Greek debt deal for interest payments due have not been agreed.

The International Monetary Fund (IMF) has an emergency account for Greece and Greek sources have suggested to various news agencies that they will be forced to use the emergency account to borrow to pay interest payments on debts due now.

On the news, markets tumbled.

As ever, we expect markets to rise and fall on rumour over the course of the next few weeks. No doubt later this week, markets will rise again as speculators make profit from market movement.

The serious issue is if a deal cannot be reached, and Greece appears to be ‘digging its heals in’ to renegotiate its debt terms, there will technically be a default.

We believe this could course a significant correction in the market, no because the Greek economy is so big that it affects global economies, but because a sovereign debt of a Nation State has defaulted i.e. not met payments to investors i.e. they have lost money and the country has been allowed to default. This puts in jeopardy any country, including the UK that wants to borrow money.

Watch this space, it could be a rocky month.