The euro showed some decline against majors on concerns Greek political leaders may not reach consensus regarding the further spending cuts needed to receive a second bailout worth 130 billion euros announced in October, thus tumbling into default as early as March as the government has to repay 14.5 billion euros of debt maturing.
Yesterday, Papademos and political leaders of three parties agreed to make further budget-cutting measures equal to 1.5% of GDP, yet they will continue talks today to flesh out details as well as other to discuss measures demanded by international lenders to grant Greece a second aid fund; specifically, bank recapitalization framework, wage cuts and measures to enhance competitiveness.
Papademos will also conduct talks today with the troika on details of the needed spending cuts, while a government official said yesterday Greece still must hammer out details of fiscal measures for this year.
Greece is set to sell 625 million euros of 26-week notes today, where the auction was supposed to take place on February 10.
