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Rehn to ‘N’: Continuing slide of Greek bond yields reflects markets’ expectations that reforms will continue

By E. Triiri   

[email protected]

Former EU Commissioner and current Finnish central banker Ollie Rehn underlined to “N” this week that the continuing slide of yields on Greek state bonds reflects the markets’ expectations that reforms in thrice bailed-out Greece will continue unimpeded.

Rehn achieved heightened notoriety in Greece, when as the relevant EU Commissioner for monetary affairs, he wished the Greek people “good courage” (kalo kouragio) in the very first phase of the punishing crisis that engulfed the country, and just a couple of months before the first bailout memorandum was hatched in May 2010.

The governor of the Bank of Finland noted that Greece’s annual GDP growth rate is triple than the Eurozone rate, while at the same time warning that risks for the east Mediterranean country emanate from a slowdown in the global economy, i.e. its impact on the all-important tourism sector.

Rehn added that although restructuring of the Greek economy has improved, more reforms are necessary. He said it was positive that the new center-right government is promoting an ambitious investments and reforms program. He said a successful “recipe” for the country also entails that the Mitsotakis government remain faithful to fiscal discipline and commitments, as well as shrinking the risks bedeviling Greece’s thrice recapitalized systemic banks.