After talks lasting for about a month between Greece and representatives from the European Commission, European Central Bank (ECB) and the International Monetary Fund (IMF) on the country?s economic progress, the Finance Ministry said on Friday discussions ended successfully.
Talks related to how well Greece is sticking to conditions set out in the 110 billion euro package agreed upon last year, its medium term plan, additional fiscal measures needed to meet 2011 goals, the privatisation program and structural reforms needed to help secure growth and boost competitiveness, the ministry said in a statement.
The inspection is crucial to whether Greece will receive the next batch of loans from the bailout fund and could well inform discussions over an extension to the current financial rescue package.
The prevailing view in the markets is that Greece, which is effectively locked out of raising money through the sale of its bonds because of prohibitively high interest rates, will need another bailout.
The negotiations with the debt inspectors, known collectively as the troika, dealt with both the steps
Greece has been taking to reform its economy in line with last year’s package of loans, and a program of additional measures for the years 2012-2015.
The Greek government is seeking to narrow its deficit to 7.5 percent of gross domestic product by the end of this year, from the 10.5 percent it stood at in 2010. To achieve that, Finance Minister Giorgos Papaconstantinou last month announced additional austerity measures worth about 6.4 billion euros for this year.
The texts detailing the measures are to be finalized ?in the coming days? and will be submitted to Parliament after being approved by the Cabinet, the ministry added.
The euro pushed up to day highs of $1.4585 after the statement, while anticipating the news, Greece’s borrowing costs eased during the day, with yields on 10-year Greek bonds dropping some 60 basis points to 16.2 percent.
Greece?s two-year note yield slid as much as 167 basis points, or 1.67 percentage points, falling to less than 23 percent for the first time since April 26.
Shares on the Athens Stock Market closed more than four percent higher.