Greece and EU aim for Sunday agreement but Moody’s downgrades bond rating

Greek Finance Minister Yannis Varufakis; relieved of negotiating duties

Greece and its European partners have stepped up negotiations and have set next Sunday (May 3) as the target for reaching an agreement over Greece’s debt,  now that its  Prime Minister Alex Tspiras has relieved  finance minister Yannis Varufakisa of his role in the talks and is taking a more active role himself. Athens’ refusal to discuss the reduction of pension and labour reforms remains a serious obstacle to a resolution, however. As things stand, Greece us due to pay out approximately  €1bn in pensions and civil  servant salaries, and repay the IMF  €880m.
In anticipation of this crunch point, Moody’s yesterday downgraded bond rating from Caa1 to Caa2  due to the “high uncertainty over whether Greece’s government will reach an agreement with official creditors in time to meet upcoming repayments on marketable debt”; and ” the significant implementation risks of a follow-up, medium-term financing programme even if an agreement is reached, given the weakened economy and a fragile domestic political environment.”

Source: Interfax