The uncertainty over Greece and weak data from Germany weaken the exchange rate of the euro at the beginning of the trading week.
No solution in sight for Greece
At the beginning of the new trading week, the euro is again loaded by the continuing crisis in Greece. While the Greek government is looking for further financial aid, their negotiation partners shows little willingness to compromise. IWF chief Christine Lagarde said in an interview in the "Financial Times" the patience of the IMF with Greece almost at the end. Also from the other negotiating partners no concession to the government in Athens is signaled. Even at Euro group meetings, which takes place this week, tangible results are expected. According to recent estimates, the Greek financial reserves will last until about the beginning of June. If by then no solution for further financing of the budget is found threatens the Greek state bankruptcy.
The consequences of bankruptcy are not yet clear, although European finance ministers expresses, they would belief that a Greek exit from the euro zone has lost its scare. This is due mainly to the taken precautionary measures. How far they will help, however, is only likely to see in an emergency, if a Greek exit should have an impact on other southern countries in crisis in the euro zone. Spain in particular in these case should be observed, where parliamentary elections will be held this year. According to recent surveys, the current sole governing PP will suffer a significant loss in these elections, and the left-wing party Podemos could be the strongest force in parliament. If a Greek exit, and the withdrawal of imported as a condition of aid packages taken reforms in Spain are well received by the voters, the next worst of the euro crisis could develop there, which has the potential to initiate a wildfire in the euro zone. To what extent the existing tools to support the crisis countries are still sufficient, may well be questioned.