Tsipras: It's a crucial time for Greece and Eurozone

Wednesday, Jul 08 2015

European Central Bank chief Mario Draghi assured euro zone leaders on Tuesday the ECB would do the necessary to keep Greek banks afloat until a

EU summit on Sunday that will seek a deal on further aid to Greece, German Chancellor Angela Merkel said.

Speaking at a news conference after an emergency summit of euro zone leaders, Merkel said she was "not exaggeratedly optimistic" of a solution to rescue Greece on Sunday but the summit had been called "because we think the situation is so dangerous".Asked if Greece could crash out of the euro zone if it failed to put forward convincing reform proposals, she said Sunday's summit would decide whether to open negotiations on a two-year programme for Athens.

The leaders had not discussed the idea of Greece possibly creating parallel currency, Merkel said. She said the euro zone stood by a 2012 commitment to look at debt relief for Greece if it fulfilled the conditions, but there could be no question of a debt haircut, which would be illegal under the EU treaty.

Tsipras addressing EU parliament said that Greek people reinforced mandate for solution and it's the Greek peoples choice not for rupture with Europe. He took responsibility for events of the last 5 months, but Greek problems have been going on for 5 years.

No vote represented a return to negotiations, not the end and Greece will continue efforts to reform sending ESM request today. Proposal asks for talks on debt relief to begin and are not aimed to burden EU taxpayers. He said Greek program needs to be possible to implement. Europe is at a critical crossroads and Euro area needs to find a final solution to debt crisis.

Euro is currently being traded few points above 1.1050 handle. Pair ia likely to find support around 1.10 level and resistance around 1.1080 area. Later today, in the US session, FOMC Meeting Minutes are scheduled for a release.

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