All eyes will be on Greece’s Syriza government in the coming weeks as it manages to settle outstanding debt with creditors. The government will have to scrape together enough cash to pay off a June 5 debt deadline to the International Monetary Fund, but many fear Greece will default on the loan.
Bond watchers were concerned that other peripheral states with growing anti-austerity political parties could push for more favorable debt relief. If creditors give Greece a pass and issues a big write down of Greek debt, there will be greater pressure to extend terms to other member states, which would quickly become economically unviable.
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Max Chen contributed to this article.