Bond market recovery indicates restored confidence in economy, gov’t spokesman says

Government spokesman Dimitris Tzanakopoulos on Thursday highlighted the positive news emerging from the Greek bond market, saying it was a sign of recovery and evidence of restored confidence in the Greek economy.

Speaking during the regular press briefing, Tzanakopoulos pointed to falling interest rates, which on Wednesday posted a seven-year low and dropped to 5.67 pct for the Greek 10-year bond at a time when the cost of borrowing in the Eurozone was rising.

“This is not a chance event but a sign of the positive climate that is arising after the completion of the second review,” he said. It was also a sign that markets considered a successful outcome of the negotiations for Greece’s debt certain, enabling the country to join the European Central Bank’s
quantitative easing programme, Tzanakopoulos added.

“The participation of foreign investors in yesterday’s issue of Greek State T-bills is a positive signs, as is the fact that the stock market has now recovered all its losses since the summer of 2015,” he noted.

The spokesman pointed to further positive news regarding the labour market and unemployment, noting that the government’s central goal was to lower unemployment and to increase the proportion of full-time jobs over more flexible forms of employment.

He pointed to a 16-year record for net hirings in April, which resulted in the first four months of 2017 ending with a net increase of 125,770 new jobs. There was also an increase in the number of full-time jobs created in April, which accounted for 55 pct of the total. This was counter to the marked trend toward less secure forms of employment in the period 2012-2014, where part-time and occasional work accounted for two thirds of the total job market.

Regarding the second review, Tzanakopoulos said the government was working hard toward a comprehensive agreement. A draft omnibus bill legislating for the prior actions will soon be tabled in Parliament, he announced, allowing the four institutions sufficient time to draft a compliance report that can then be formally ratified at the next Eurogroup.

At the same time, negotiations were continuing for a decision that will satisfy all parties involved concerning the medium-term measures for Greece’s debt, which will be activated after the end of the programme in the autumn of 2018.

“We hope that the momentum from the completion of the review will lead to an agreement on this issue also, ideally at the next Eurogroup or else a few days later if further deliberations are necessary,” Tzanakopoulos said. “In any case, the country is entering a period of stability, with signs of gradual recovery already appearing,” he added.

Turning to other issues, Tzanakopoulos did not rule out the possibility of a meeting between Greek Prime Minister Alexis Tsipras and U.S. President Donald Trump on the sidelines of the NATO summit on May 25. “There is nothing scheduled at this time but I would not, however, rule out such a meeting,” he said. He also announced that the prime minister will soon contact the new French President Emmanuel Macron.