Greece votes, markets express relief
The pro-bailout New Democracy party emerged as the victor in Greece’s Sunday elections, a result which allowed for an international sigh of relief. The Euro leapt to a one-month high but underlying the positive reaction is the acceptance that challenges remain.
The election came as welcome relief as the G20 prepared to start its summit in Mexico. In addition to feeling increased pressure from the United States and Asia to take affirmative action to right its fiscal ship, Europe faces a number of coming challenges.
One of the biggest obstacles will be Greece’s ability to quickly form a coalition government, which some see as crucial to wooing support from Germany.
While German Chancellor Angela Merkel will not entirely reverse her stance opposing the Greek bailout package, positive movement could temper her reluctance.
“But the assumption is widespread, at least in Britain and France, that the German Chancellor may shift her position – by agreeing to tweak the existing deal rather than scrap it – if her preferred Greek partner, New Democracy, forms the next coalition government in Athens,” says the Independent newspaper.