Government or no government the Hellenic Republic would have to decide today whether to pay a coupon to the hold out owners of XS0071095045. It is not much, just 4.4million. Will they pay or not? Of course there is a grace period but failing to give an adequate explanation for the delay may be an early indication for the big one that is coming on the 15th May (434million). Who will decide? The Greeks or the Europeans? Finding 434million when the whole deal with the Troika (Memorandum) is under threat may be difficult.
Then you also have the bond that the ECB holds which is 3.3billion. The Greek government is expecting the money by the 10th of May in order to pay this on the 18th of May. Will the EU send the cash? Probably yes. What is more problematic is the next instalment in June.
How would the markets and Europe react to a non-payment of either today's coupon or even of the May 12 bond? Well, if the markets fail to react to a non-payment then this may be taken as a sign that Greek risk is decoupling from the rest of Europe and that the exit path from Euro is a real possibility.
Then you also have the bond that the ECB holds which is 3.3billion. The Greek government is expecting the money by the 10th of May in order to pay this on the 18th of May. Will the EU send the cash? Probably yes. What is more problematic is the next instalment in June.
How would the markets and Europe react to a non-payment of either today's coupon or even of the May 12 bond? Well, if the markets fail to react to a non-payment then this may be taken as a sign that Greek risk is decoupling from the rest of Europe and that the exit path from Euro is a real possibility.
