Moody’s: ‘High likelihood’ of Greek Capital Controls

There is a “high likelihood” of capital controls being introduced in Greece, according to a report published by Moody’s on Wednesday, starting with a deposit freeze at Greek banks.

Moody’s Investor Service downgraded its outlook for the Greek banking system to negative from stable, which it said reflected: “the significant deterioration in banks’ funding and liquidity since December 2014, with deposit outflows estimated at more than 30 billion euros ($33.3 billion), or 18 percent of total deposits, over the past five months.”

These pressures are unlikely to ease over the next 12-18 months, Moody’s said, “and there is a high likelihood that capital controls and a deposit freeze will be imposed.”