Greece passes 2013 budget but decision to delay its sign off is causing uncertainty in the markets

James Hughes, Chief Market Analyst at Alpari, one of the world’s leading forex brokers, said: “Greece went some way to securing the final bailout payment over the weekend, passing its 2013 budget in parliament, which contained a selection of new austerity measures. The next bailout tranche was expected to be signed off by the finance ministers at the eurogroup meeting today, however this has been delayed until the end of the month, which has created further uncertainty in the markets.

“The decision to wait until the end of the month has caused confusion in the markets. This was a great opportunity to ease some of the uncertainty and show that the eurozone can act quickly and decisively. The decision to delay it until days before Greece runs out of cash says the opposite - it unnecessarily creates uncertainty.

“One sticking point that may be causing the delay is the two additional years it includes, for Greece to hit its fiscal targets. This is likely to be unpopular in Germany and they will not want to be seen easing the terms for the Greeks. However it is necessary, along with other measures such as debt haircuts in the future, in order for Greece to have any chance of getting back on its feet.”

Note: The content of this text comprises personal opinions and ideas and should not be taken or misunderstood as investment advice.