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Risks at Home Mount for Greece in Its First Post-Bailout Year

Sotiris Nikas, (2019), “Risks at Home Mount for Greece in Its First Post-Bailout Year”Bloomberg Economics, 3 January

After emerging from its steepest economic crisis in living memory, Greece still has a mountain to climb in 2019 if it’s to consummate its comeback with a sustained return to bond markets.

The government plans to issue as much as 7 billion euros ($8 billion) of new debt this year, using part of its cash buffer to repay some International Monetary Fund loans early. The finance ministry could test markets with a short or medium-term note as soon as this month if market conditions allow it, according to a person familiar with the matter.

That’s going to be a tough ask. While the external market will continue to have a bearing — as it did last year when contagion from Italy helped prevent Greek government bond yields from dropping — Greece faces three main domestic risks in its first year since exiting its bailout.

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