The exit path becomes clearer

Developments last week shed more light on the course of events which could culminate in the exit of Greece from the euro-zone. The failure of the political parties to form a coalition or even appoint another technocratic government has increased the risk of prolonged policy deadlock. Meanwhile, a potentially powerful economic trigger came into view in the form of the sharp fall in Greek bank deposits. Our warning a year ago that it could be pressure in the banking system that prompts a euro-zone break-up is looking increasingly prescient.