ECONOMY

Greek securities tumble as negotiations raise specter of crisis

Greece’s bonds dropped, with yields on the country’s 2017 notes rising the most in two months, as negotiations over the future of its financing stoked concerns of renewed turmoil in the nation.

Greek securities fell as government officials returned to work after the Orthodox Easter break to resume talks to unlock financing and keep the country afloat. Baring Asset Management said Tuesday it sold its holdings in Greece’s five-year bonds two weeks ago, while the International Monetary Fund said that a crisis in the nation cannot be ruled out.

“Financial and geopolitical risks have increased,” IMF chief economist Olivier Blanchard said in statement at start of a press briefing in Washington on Tuesday. “A Greek crisis cannot be ruled out, an event that could unsettle financial markets.”

The yield on Greek notes due in July 2017 rose 225 basis points, or 2.25 percentage point, to 23.59 percent as of 3:58 p.m. London time, the biggest increase since Feb. 9. The price of the security was at 67.43 percent of face value. The nation’s five-year yield added 110 basis points to 16.73 percent.

Greece owes about 184 billion euros ($197 billion) to euro- region governments and the crisis-fighting fund they set up in 2010. Most of the debt is in emergency loans. European Union finance ministers are planning to meet on April 24 to discuss proposed economic reforms in Greece.

[Bloomberg]