The fractured 17-nation eurozone is heading toward the first default of one its members after Greece was last night forced to accept its second bailout in the face of an overwhelming mountain of debt.
The EUR109 billion bailout, which follows last May’s EUR110 billion bailout, introduces new measures including extensions on the time allowed for Greece to pay back its debts, decreased interest rates and a financial hit for private sector investors, who were previously regarded as sacrosanct.
After weeks of deadlock and several hours of fraught negotiations, eurozone leaders finally agreed to award Greece a second eye-watering chunk of cash. The move caused stocks to rise, bond yields to fall and gave confidence to the euro, which gained against the dollar.
So far so good, but looking further into the future, numerous questions still remain unanswered.
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