Greek central bank Governor George Provopoulos said heÃ¢â‚¬â„¢s confident the government will meet its Ã¢â‚¬Å“very ambitiousÃ¢â‚¬Â deficit-reduction goals and ward off any further credit-rating downgrades.
Rating agencies Ã¢â‚¬Å“want evidence that the plan is implemented on targetÃ¢â‚¬Â and Ã¢â‚¬Å“some time will need to elapse before they can form a better judgment,Ã¢â‚¬Â Provopoulos, also a European Central Bank council member, said in an interview in Athens on Feb. 19. Ã¢â‚¬Å“I have full confidenceÃ¢â‚¬Â in the government meeting its goals, he said. Ã¢â‚¬Å“They have to succeed. And they will, IÃ¢â‚¬â„¢m sure of that.Ã¢â‚¬Â
GreeceÃ¢â‚¬â„¢s financial distress could be exacerbated at the end of this year when the ECB is due to revert to old collateral rules that were loosened during the global recession. If MoodyÃ¢â‚¬â„¢s Investors Service cuts its Greek credit rating to the same level as the other major ratings companies, Greek government bonds would no longer be eligible as collateral at the ECB, making it more difficult for the nation to borrow.
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