Markets Rattled on Greece and its Not Over Yet

The Eurozone, the International Monetary Fund (IMF), Greece and the entire Troika are walking a tight wire as the negotiate Greece’s payback of its enormous pile of debt they owe. Greece will now close down their banks the entire week as the population is running to withdraw cash from ATMs and waiting in line. Global financial markets are being hammered. From the Forex markets to the stock and bond markets.

This morning, when the Asian markets opened, they suffered through some heavy selloffs. The Japanese Nikkei is down 1.78 percent and China’s Hang Seng is down nearly 1.74 percent at the time of this report. Currencies like the euro are also significantly lower as the week begins. US Stock futures are also significantly lower. European stock markets are also set to open lower today.

Greece has placed strict currency curbs into place as their place in the common currency block has entered a very precarious stage after the European Central Bank (ECB) decided not to send emergency funds to Greek banks, especially at the levels they are currently at.

Currency controls and curbs are now in place as Greek Prime Minister Alexis Tsipras has order the central bank to recommend a bank holiday as well as stiff capital control. Greek banks will be closed the entire week.

At this time, well on Friday, Tsipras called for an emergency referendum for July 5. Greeks will vote, in a remarkable show of democracy, whether or not to accept more rescue funding from international creditors. This will come with more austerity measures, which has already crippled their economy. Therefore a “NO” vote is expected which will lead to Greece, at first defaulting on this current payment, then leaving the European Union.

Instead of allowing Greece to crawl out of this crisis and repair their economy, the country now has its back firmly in the corner and must take measures to ensure they can eventually recover. The road will be far from easy.

Stay tuned to CupO’Forex and we will be updating this story as it unfolds.