Prof. Roubini: 70% chance of Greek eurozone exit

Wednesday, 06 June 2012 17:56

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The global markets are expecting the upcoming election in Greece to clear the situation with its possible exit from the eurozone. But Professor Nouriel Roubini is sure that the probability of so-called “grexit”, or Greece exit from the eurozone, will remain high despite voting results. 

"I would say that by next year there is at least a 2/3 probability that Greece will exit the eurozone. I think, eventually, even if they elect now in June a new government that is going to try do reform, the economic situation is becoming so unsustainable that they will exit. It could be good for them as long as the exit is orderly. It means that then they’ve massive depreciation, their exports become more competitive, they restore growth, external balance. Of course there will be damage to the banks, to the savings of people in the banks. And that’s where they need more funding to make sure that its not disorderly meltdown and the contagion to the rest of the eurozone is modest. So, if it’s done negotiated way and it’s financed and it’s orderly, probably, it’s a manageable kind of exit."

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