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Eurogroup in talks over Greece (video)

Currencies Direct February 20th 2015 - < 1 minute read

Today Greece faces crucial Eurogroup talks in Brussels to try and secure a deal on its debt. Yesterday Greece submitted a formal request to the Eurogroup for a six-month extension of its loan, hoping the extra time will allow it to draw up a new programme from scratch. Greece also tried to reassure creditors that it will honour all financial commitments to them and impose reforms on tax evasion and corruption.
 
The EU will meet this afternoon at 14:00 GMT to see if there is room for a compromise, but it appears from a document leaked to Reuters yesterday that Germany remains sceptical over parts of the letter, which it believes to be vague and open to interpretation. Germany called the proposed agreement a "Trojan horse" that would allow Greece to obtain extra funding without committing to reforms and conditions of its bailout. In case a compromise is not reached, Greece faces large repayments of its debt as early as March and in the summer months — this could trigger a default and therefore a Grexit (Greek exit from the Euro).
 
In other news out this morning, the service sector in Germany expanded faster in February and suggests that Europe’s largest economy is on track for solid growth in Q1. The Puchasing Managers’ Index, which tracks growth in the manufacturing and services sector, climbed to 54.3 in February. This is significantly above the key 50 threshold, which indicates growth.
 
In the UK, the market will focus on retails sales, which are expected to contract for the first time in four months and might slightly weaken the pound in the short term. In the US, Manufacturing PMI is scheduled for release.

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