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Goldman Says Grexit Won’t Help Greece

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Fears Greece may exit the euro and revive the drachma abound, but attempting a return to the currency Athens left behind would have tragic results, Goldman Sachs said.

“Transitioning from the euro to a new national currency is no straightforward task either for Greece or for Europe,” Goldman said in a note Monday. “Greece can’t just (re)introduce a national currency.”

Debating whether to rekindle the drachma, or drachmatization, isn’t just an academic question. With negotiations over Greece’s debt and finances proving touchy, the possibility the country may exit the euro zone, a scenario dubbed “Grexit,” has become more likely, analysts say, although they still assign a relatively low probability.

“The probability of an accident is still there,” Goldman said.

via CNBC

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza

@alfonso_forex

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