The word of the day is “crexit,” which was coined by Allianz Chief Economist Michael Heise. This is the idea that Greek will exit from its economic crisis this year.
However, many point to a speech given by European Central Bank president Mario Draghi as the turning point for the eurozone crisis as a whole.
“Draghi’s comments “within our mandate, the ECB is ready to do whatever it takes to preserve the euro” turned sentiment and substantially reduced break-up risk,” write Deutsche Banks economists.
Here’s a chart from the bank’s latest House View presentation. It’s the percentage of investors expecting a country to exit the Eurozone over next 12 months. As you can see, fears of a breakup have tumbled since Draghi’s comments.
Source: Sentix GmbH, Bloomberg Finance LP, Haver Analytics, Deutsche Bank Research
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