February 11, 2012
Tortuous negotiations over a second bailout for Greece are set to come to a head on Wednesday, putting fragile market confidence to the test on the same day data is tipped to show the euro zone is entering a mild recession.
U.S. retail sales and the release of minutes from the last Federal Reserve rate-setting meeting, data on UK inflation and unemployment, more corporate earnings and a Bank of Japan policy meeting also stand on the market's radar.
But it is Greece and a March 20 deadline, when the country must find 14 billion euros ($18.6 billion) to meet debt repayments or face the prospect of a chaotic default, that will hold the market's attention.
Euro zone officials have said February 15 marks a cutoff points for agreement on a new bailout deal, without which Greece will have no funds to cover the March repayments.
"We have a very stretched timetable, so if there's no agreement on Wednesday any Greek deal would be in dangerous territory," Thomas Costerg, European Economist at Standard Chartered Bank said.
"Although a disorderly default is not our central scenario, risks are definitely rising and we think this would have huge consequences potentially on confidence, on financial markets and on the banking system."
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