Greek Prime Minister Alexis Tsipras and his creditors sparred heading into Sunday’s referendum on austerity, deepening Greece’s financial misery. As rationing of pensions began on the third day of capital controls, Tsipras said he was willing to accept the latest offer from his antagonists as the basis for talks on a new deal. German Chancellor Angela Merkel ruled out such discussions until after the July 5 plebiscite.
The battle lines ahead of the vote now appear immovable as Greeks adjust to their new reality with no prospect of their economic woes ending any time soon. The political posturing, along with the expiry of its bailout deal and a missed payment to the International Monetary Fund, masked the desperation as the economy sputtered and cash ran low.
“The clock cannot be simply set back to where it was Friday night before Tsipras broke off the talks,” Holger Schmieding, an analyst at Berenberg Bank, wrote to clients. “A deal is still possible, but it would require more than just this letter.”