Greek Indices Nosedive, As MPs Fail To Elect President – 29 December 2014

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Stocks in Greece have plunged 11 percent after the government decided to call snap parliamentary elections on January 25 after parliament failed to elect a president in a key vote Monday.

The index recovered to be down 3.91 percent by 16:00 GMT.

The snap elections will decide whether the country receives more financial assistance from the ‘troika’ of creditors (European Commission, the European Central Bank and the IMF) and continue its policy of austerity. The policy of spending cuts and international borrowing has already boosted Greece’s external debt to 177.7 percent of GDP, while dropping austerity could mean exiting the eurozone.

The IMF said Monday it is suspending financial assistance to Greece until the new government is formed, AFP reports.

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