Time is running out for Greece

The failure of the Eurogroup last week to agree even on steps for further discussions on Greece does not bode well for the emergence of a full solution at Monday’s meeting. This could prompt nerves over whether the ECB will cut off emergency funding to Greek banks on Wednesday.

Even if a plan is agreed, it is likely only to tackle Greece’s near-term financing requirements and hence kick the can down the road. Finding a lasting solution to Greece’s debt burden that would guarantee its future inside the currency union will be a much bigger challenge.