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Quick warning.We’ll need to start talking about Greece again pretty soon.
It hasn’t been at the front of anyone’s mind in a while, and that’s in large part because Europe is shut down for the month, but come September, the question of Greece’s fate in the Eurozone will become an issue again.
In a recent note, Dan Greenhaus at BTIG wrote:
A few clients have asked for some specifics surrounding our “fall nervousness” related to Greece and Europe. Simply put, we assume the next Troika report on Greece will begin in at a meeting in mid September, the 14th to be specific. It’s impossible to see anything occurring in the Greece front before then — even as the economy implodes on itself. And if things go less than swimmingly during the review, the next trance of monetary support might not come until the IMF annual meeting in mid October. Admittedly, concerns about Greece are..not what they once were but if you’re concerned about a Grexit and what effect it might have on sentiment, as we are, then the fall brings the next “launch window.”
Morgan Stanley’s Gregory Peters also pointed out in a recent note that September will bring turbulence, some of which will be Greece related:
September bristles with risk for investors. The Troika returns to Greece in early September; the German constitutional court will rule on the ESM on 12 September; and ECB bond purchases are conditional on Spain or Italy formally applying for assistance. The Fed meets informally at Jackson Hole in late August, and the FOMC convenes on 13 September. In Vincent Reinhart’s view, substantial action (particularly QE) is very unlikely.
Meanwhile, reports say that Greece will seek a 2-year austerity extension during talks next week between the Greek Prime Minister Samaras and the heads of France and Germany.
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