No more concessions for Greece?

Over the weekend, Greek FM Stournaras said the Troika refused to make any further concessions to proposed labour reforms. The junior coalition party, Democratic Left, opposes these labour reforms. According to a government official, Athens would present the bill on labour and other measures on Nov 5 to parliament. The Democratic Left has the support of 16 deputies in the 300-seat parliament, which means the government (176 seats) could pass the package without its support. This would however harm the credibility of the fragile Greek government. Agreeing on the €13.5B austerity and the structural reforms, would pave the way for a thumbs up towards the next €31.5B loan tranche at the Nov 12 Eurogroup meeting. This week, there are also two teleconferences regarding Greece. Today, the euro working group discusses the current package and on Wednesday the Eurogroup over the PM Samaras’ bid to secure a two-year extension for its bailout program and the way the budget gap (€30B) should be financed. Der Spiegel writes that a draft Troika report calls on EMU governments and the ECB to write off a chunk of their loans but German FM Schaeuble once again rejected another debt restructuring for public or private creditors. Overall, we consider the developments in Greece over the weekend negative, which can weigh on sentiment today.