The decision of the Greek government in the New Year on printing elections on 25 January, triggered Monday renewed turmoil in global financial markets about Greece’s future in the EU currency union.
the euro fell to $ 1.18 which is the lowest quotation since March 2006.
Athens Stock Exchange plunged
The new uncertainty about a possible “Grexit» – that Greece could be evicted or voluntarily leave the eurozone – Depressed share prices on European and Asian exchanges.
The exchanges in London, Paris and Frankfurt fell between 0.5 and 0.7 percent, while Athen- Exchange fell 4 percent.
The value of Greek shares have fallen by 40 percent since March last year, according to Reuters.
Asian stocks fell 0.8 percent and the Tokyo Stock Exchange with 0.25 percent.
Wall Street amplifier fall
stock decline was exacerbated when US exchanges opened Monday afternoon (Norwegian time).
The benchmark Dow Jones index fell 0.8 percent shortly after opening, while the broader composite S & amp; P 500 index was down 0.6 percent and technology shares on the NASDAQ down 0.5 percent.
Monetary Position Erne speculate now that the European Central Bank (ECB) is going to decide to buy up government debt in the crisis euro countries, the ECB chief Mario Draghi signaled already by the previous monetary policy meeting in the bank.
But a massive acquisition of such debt securities will not to reinvigorate euro economies, according to a survey by the British newspaper Finanscial Times has conducted among a group of financial analysts.
Stagnation in the euro zone
Euro countries gathered experiencing economic stagnation, more countries is in its third economic downturn since the global financial crisis in 2008.
The growth was marginal 0.2 percent for the whole euro zone overall in the third quarter last year.
It has set a new momentum in speculation about the acquisition of government debt, was an interview with Draghi in the German newspaper Handelsblatt before the weekend. There he said that the danger that the ECB does not fulfill its mandate of maintaining price stability, is greater now than it was six years ago.
Nearly negative inflation
ECB steering a price target when it sets interest rates. The goal is to keep the annual inflation just below 2 percent, but now inflation so low (0.3 per cent in November) that the eurozone risks falling into another financial difficulty with negative inflation (deflation).
Therefore, the ECB has almost burned off all the powder in the interest rate weapon to bring up economic growth. The central bank’s key interest rate was lowered in September to 0.05 percent.
The new inflation figures for Germany Monday showed that inflation fell to 0.2 percent in December, helped to reinforce the turmoil in financial markets. On a yearly basis the German inflation of 0.9 percent.
Merkel will have with the Greeks
Germany does not want Greece leaving the eurozone, said a spokesperson for Chancellor Angela Merkel Monday.
The need for such a statement came after several media at the weekend reported that Germany can live with that Greece exits the euro zone.
The new turmoil in financial markets about Greece’s future as euro member, sent also increased the interest rate on Greek government debt. The yield on ten-year government bonds rose 0.21 percentage points to 9.46 percent and the yield on three-year debt securities rose above 12 percent.
By comparison, the rate on German ten-year debt securities 0.5 percent and the rate on three-year government bonds is German negative.
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