German government bonds opening lower Monday after Greece’s parliament late Sunday approved an extremely unpopular package of extra austerity measures. Greek lawmakers approved the new measures by an overwhelming majority: 199 voted in favor of it, versus 74 who voted against it and 5 who cast “present votes.” The measures voted on included E300mln in pension cuts, a 22% reduction in the minimum wage and a plan to slash public sector payroll jobs by 2015. The vote represents a significant step towards unblocking negotiations with the so-called troika for the new E130bln loan package. However, it is still unclear whether that will be enough in and of itself to secure their approval for the new bailout at an upcoming meeting of the Eurogroup in Brussels scheduled for Wednesday. The troika has made it clear that it wants to see clear evidence of implementation, and that the parties supporting the coalition government of Greece’s interim Prime Minister Lucas Papademos must commit in writing to the measures, so that whoever is in power after elections in April will continue to implement them.
EasyForexNews Research Team