BREAKING: Syriza’s rebel MPs announce Popular Unity (+ video)

Another election, another uncertain cloud looms over Greece, another volatile market. Now that Greece has received its latest bailout funds and settling some of its huge debt, Alexis Tsipras has decided to step down as Greek Prime Minister and hold a general election.
 
He has said that mounting tension within his own party regarding the bailout conditions and failing to achieve what he set out to do in the negotiations has helped with his decision. It looks as if the agreement with Greece’s creditors has merely papered over some potentially horrendous cracks, which will show if Greece doesn’t swiftly act to solidify a more welcoming Greek parliament.
 
There’s every chance Syriza will be returned to power, but what this means for the current bailout and the euro generally is still uncertain. Credit ratings agency Moody’s has said: “[Mr Tsipras’] move to step down and call snap elections on 20 September could elevate programme implementation concerns and potentially puts future official sector disbursements at risk.” In other words…. Wait and see.
 
News has just emerged that already Syriza has split. Rebel Syriza MPs have announced that they have formed a new party, “Popular Unity”, which aims to distance itself from what it sees as Syriza’s “betrayal of anti-austerity principles”.
 
Sterling holds its own
 
July retail sales in the UK were up 0.1% from June’s 0%, giving the pound a boost on Thursday morning. Household goods, like electronics, were top of the list, helping to counter cheaper clothes and petrol. Expectation was for the figures to be better than what was on offer due to recent wage increases, but investors seemed happy enough to back Sterling in early trading.
 
China’s frail bones
 
The second biggest economy in the world seems to have hit the brakes, as manufacturing Purchasing Managers’ Index activity has again fallen below the 50 level (above 50 indicates growth). July’s figures of 47.8 were backed up with frail 47.1 for August, which is its lowest data release since early 2009.
 
The market for Chinese smartphones also showed poor results – for the first time ever, sales have fallen and are down by 4% from last year.

Have an excellent weekend.

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