Greece looks forward to reinstallation of waiver

Greek 10 year bond yield dropped from 11.6% in February to 7.2% as of now, as it became evident that Greek government will be able to pass through the tough reforms required to unlock the bailout fund and this week Euro group finance ministers not only unlocked the bailout fund, they have agreed to provide, short, medium and long term debt relief.

Now, the country is looking forward to gain back the waiver from European Central Bank (ECB), which got lost after the rise of Syriza party, leading to deadlock between lenders and Greek government. With ECB’s waiver on Greek bonds, which is not investment grade, they can be used as collateral in the banking system.

ECB officials will be meeting in Vienna, next week to decide on the waiver issue and Greek officials are optimistic that they will gain back the waiver after more than a year, giving its banks access to cheaper loans from ECB.

If gained, that would be big boost for Greek banks and government bonds.