The first week of April saw the intensification of pressure on the prices of peripheral government bonds which until now had represented a sort of haven for investors most adverse to the turbulence on the stock markets. The Bund thus celebrated a new low, also thanks to the "reinforced" QE, and the auctions of Spain, Italy and Portugal obtained a tepid response.
The IMF's warning about a review of global growth prospects follows a series of statements released by the Fed and the ECB, for the series that the inflation targets were too ambitious, the risk of deflation is evident and has not been eradicated and we are still looking for the starting point to restart growth.
We are facing a crucial month in terms of the weight of maturities and coupons for the debt of countries still highly indebted and therefore at the mercy of the sentiment of investors who are affected by the high volatility of the stock exchanges, now also transferred to bonds.
Meanwhile, the Greek privatization plan scores a blow of almost 400 million euros, pace of the Americans and their tug-of-war made binding through the IMF, and Lagarde's nice "broadsides" against Tsipras. As expected, the Port of Piraeus was sold to China Cosco Shipping Corporation for 280.5 million with a 51% stake which will be implemented by another 8% in five years for another 88 million euros. But that's not all because new agreements on the energy sector with Russia could be on the way. The privatization plan had an ambitious target of 50 billion euros and this is just a start.
From the German front, a unanimous chorus has finally risen from the political world in favor of an agreement with Greece and with the IMF, including by the end of Orthodox Easter and therefore by the end of the month of April. The meeting between Lagarde and Merkel in Berlin on 5 April proved to be crucial in bringing the IMF back to reason and demonstrating a substantial will of the EU to avoid a new Greek drift.
The ten-year Greek bond remains below 9% also due to the renewed tensions of the last month, but the times of the tough opposition from Schaeuble are behind us and Merkel wants the three-year plan to be finalized and work effectively. There mission impossible of the German Chancellor is to avoid the worst before the summer, and therefore to keep EU intervention separate from that of the IMF but making them converge in a common aim of safeguarding the country from new financial turmoil, thus allowing the Government to continue with the austerity measures.
But the obvious objective is to capitalize on the improvements that have already been glimpsed in the drop in Piraeus Bank's NPLs with a credible aid package to give a definitive swerve on the side of creditworthiness and therefore of the rating and allow Greece to regain of its important role in the extension of QE, which is currently precluded due to the lack of tangible results that allow the ECB to accept Greek bonds with a rating therefore in line with the dictates of the unconventional policies implemented up to now by Draghi. Not only when the Greek banks will therefore be able to access medium and long-term forms of employment and the program called TLTRO II, will it be possible to gradually reduce the emergency measures given by the ECB's intervention lines called ELA.
Faced with the "financing" plan for refugee policy granted to Turkey, these speeches appear almost paradoxical taking into account the fact that Greece is part of the EU while Turkey will hardly ever be part of it, but we know that the geopolitical tensions of the area have allowed Erdogan to sign opportunistic and highly questionable agreements with the EU for the well-known facts that characterize an authoritarian internal policy and all to the detriment of the Kurdish minority and the political opposition and not wanting to look at connivances with the IS.
The leak related to a Wikileaks report that showed an IMF inclined to a Greek default in the imminence of the June 23 Brexit referendum in an anti-EU version has been denied but as the Panamaleaks scandal demonstrates, wars are now aimed at domination economic and financial, rather than territorial, and are fought with a mix of cyber attacks, currency wars and massive use of financial information to destabilize a precarious global balance.
And perhaps the anger of Tsipras who urgently summoned the Government on the Wikileaks case and led it to start a closer collaboration with the Chinese and the Russians, openly criticizing Lagarde's utilitarian vacillations, would find more than one justification.
