Saturday, July 4, 2015

Oxi or Nai

Patrick Chappatte 

If Greeks vote "Yes" to the deal with creditors - pension cuts, VAT rises and all - just maybe the European Central Bank (ECB), whose governing council meets on Monday morning, will lift the ceiling a fraction on the provision of Emergency Liquidity Assistance (ELA). That might not permit banks to start operating as normal with immediate effect. But it could allow the 60-euro daily ceiling on withdrawals to be raised a bit, and the total freeze on transfers abroad to be eased somewhat. And that might allow the Greek economy to be taken out of the deep freeze it has been in since banks were ordered to more-or-less close last Monday. But if Greeks vote "No", as the government wishes them to do, there would be zero chance of the ECB turning on the ELA tap again.
BBC Economics editor Robert Peston

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