Greece"s red herring

• Greece rated ninth riskiest country by the CMA DataVision platform

The European Commission will most likely launch infringement procedures against Greece, due to unreliability of the statistics issued by the Greek authorities on budget deficit and the country"s debts, according to European sources.

This would not be the first attempt of the European Commission to launch infringement procedures against Greece, after it warned Greek authorities in 2004 on their statistics concerning the country"s deficit, but the procedures were closed in 2007.

"Another infringement procedure could happen, since according to EU legislation, providing timely and reliable statistics is an obligation, and they failed to meet this obligation", the EU source said.

• Greece"s expensive debt puts pressure on Greek banks

Shares of Greek banks started to slide after Greece announced yesterday that it borrowed 2.34 billion dollars (1.6 billion Euros) on the financial markets at a very high premium, while the cost of insuring government bonds increased.

The sale of government bonds thus put pressure on the stocks of banks listed on the Athens stock exchange, since the loan directly affects their borrowing costs, as the banking index of the Greek stock market dropped around 4%.

The increase of the budget deficit and of government debt caused the three major rating agencies to lower the country"s rating.

Following the issues caused by Greece"s huge budget deficit of 12.7% of the GDP in 2009, the cost of insuring Greek debt rose steeply, with the CDS spread reaching 280 basis points, which puts Greece among the nine riskiest countries, according to the CMA DataVision platform.

The government led by George Papandreou announced an economic reform program, in an attempt to convince the European Commission and investors that it can manage its current public deficit which reached 12.7% of the GDP in 2009, the highest in the EU.

Papandreou assured that the deficit will drop to 8.7% this year and to at most 3% in 2012, one year earlier than previously announced.

• The IMF negotiating a possible financial aid for Greece in Athens

The International Monetary Fund announced in the beginning of this week that it would send a mission to Athens in the coming days, to negotiate a potential financial aid for Greece, to help the country face its current financial predicament.

The mission will take at least a week, with its stated goal being to "explore the possible avenues for providing technical assistance to the IMF within the following months on the issue of pension reform, of the policy concerning taxes and budget administration", officials of the IMF said.

Today, experts of the European Commission and of the European Central Bank will meet with Greek authorities to discuss the emergency measures which Greece needs to implement.