Heightened volatility and uncertainty continue to plague global markets. Greece remains centre stage in a week where the country has defaulted on an IMF payment and called a referendum vote to essentially decide whether to remain in or exit the single currency monetary union. The Greek Prime Minister is firmly in the “No” camp for exiting the Euro and current opinion polls have the “No” vote slightly in front.
The result of the Greek referendum will be known on Monday morning (our time) and Greek banks are expected to open after being closed all last week – however, I’m not sure how long this will last if the European Central Bank doesn’t continue providing emergency liquidity support for Greek banks in the event of a “No” vote.
As at the time of writing, over 80% of the votes have been counted and more than 60% of the Greek electorate has voted “No” to additional austerity outlined in the creditors’ proposals. Financial markets will react negatively to this on the open this morning as the initial implication is that it raises the probability of a Greek exit from the European Union occurring.
Saw this cartoon in the Financial Review last week…
Locally, we have a bit of data out (employment numbers and housing finance) plus the monthly Reserve Bank Board meeting but no one is predicting a move in monetary policy this Tuesday.
We are also likely to see significant commentary around the Federal Government’s release of the Agricultural Competitiveness White Paper on the weekend. In what is called a “Five Priority Areas for Action” with $4billion worth of initiatives, the vision is to build “a more profitable, more resilient and more sustainable agriculture sector to help drive a stronger Australian economy.“