Greece situation to calm down in the short-term, but risks remain – ING

FXStreet (Barcelona) - Carsten Brzeski of ING, notes that Greece has only taken the first step towards an extension, the bigger test will be at the end of April.

Key Quotes

“Looking ahead, several national parliaments will have to ratify the deal (with the German Bundestag voting on Friday). In our view, the ratifications should be done deals.”

“The bigger test for Greece will be at the end of April, the deadline by which Greece will have to present details and legislation of the planned reforms. If successfully done, the negotiations on a third bailout package, including the postponed discussion on Greek debt sustainability will start and could give rise to new tensions.”

“In the short term, our view is that the Greek situation should calm down, at least until the end of April. However, some risks remain, with in our view the two most likely being a break-up of the Greek coalition on the planned reforms and/or new unexpected fiscal surprises.”

“As a consequence, Greece has now taken the next step towards an extension of the bailout loan. It’s not there, yet.”