Greece Must Meet Sunday Deadline

by James G NeugerJonathan StearnsStephanie Bodoni – Bloomberg

European leaders set a Sunday deadline for Greece to accept a rescue, saying otherwise they’ll take the unprecedented step of propelling the country out of the euro.

At a Brussels summit, Greece’s anti-austerity government was ordered to make new economic reform proposals that could earn it another aid package and head off financial ruin.

“We have only a few days left to find a solution,” German Chancellor Angela Merkel told reporters late Tuesday after euro-area leaders met in Brussels. She conceded that she is “not especially optimistic.”

Sunday now looms as the climax of a five-year battle to contain Greece’s debts, potentially splintering a currency that was meant to be unbreakable and throwing more than half a century of European economic and political integration into reverse.

“We have a Grexit scenario prepared in detail,” European Commission President Jean-Claude Juncker said, using the shorthand for expulsion from the now 19-nation currency area.

The European Central Bank will end its support for Greece if “there is no political accord in sight,” board member Christian Noyer said Wednesday in an interview on France’s Europe 1 radio. “Then our rules force us to stop completely. We’re starting to be very worried.”

The euro slid, and was 0.2 percent lower at $1.0990 at 10:25 a.m. in Athens, hovering near a six-week low. European stocks were little changed near correction levels with the Stoxx Europe 600 Index up less than 0.2 percent to 373.29.