Greece’s prime minister is braced for a confidence vote on Friday to force lawmakers to back his plans to exit an international bailout program early.
Antonis Samaras’ government is hoping to win today’s vote and thus dispel investors’ fears of political instability in the country. Samaras’ government has been plagued by the prospect of snap elections early next year if the prime minister fails to gain the support of opposition lawmakers for his candidate for president in elections early next year. A promise to exit the painful program early could be key in securing that backing.
A potential early exit from the bailout program — which imposed tough austerity measures on the country — has already rattled investors’ nerves however.
Greek bond yields rose to a six-month high this week ahead of Friday’s confidence vote in parliament. The yield on 10-year paper currently stands at around 6.6 percent.
Greece is hoping to be able to meet its funding needs through the debt markets, rather than call on the Troika of lenders – the European Commission, European Central Bank (ECB) and International Monetary Fund (IMF).
Demand has been getting stronger for Greek paper since the country returned to capital markets earlier this year after a four-year exile. But many analysts remain concerned about the country’s ability to fund itself without the help of its partners.
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