Greek bond yields have climbed sharply as investors fret over domestic political uncertainty and an impasse between the country's troika of official sector lenders.
Greece’s small Democratic Left party could pull out of the government coalition headed by premier Antonis Samaras after the collapse of talks on resuming state television broadcasts. The abrupt shutdown of broadcaster ERT angered the Democratic Left’s members of parliament and caused consternation among Greece’s austerity-fatigued population. Mr Samaras said that he was determined to avoid early elections despite the row.
If the current review of the programme “is concluded by the end of July, as expected, no financing problems will arise because the programme is financed till end-July 2014”, Gerry Rice, an IMF spokesman, said in a statement.
Mr Samaras’s New Democracy party and its Pasok ally jointly have 153 deputies, a slender majority in the 300-member parliament. But the departure of the Democratic Left would be a blow to a government that still has to impose deep public spending cuts and oversee a large privatisation programme.
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