Greek assets rally after positive reaction to proposal

A new proposal by Greek Prime Minister Alexis Tsipras drew a rare positive nod from European officials ahead of marathon talks on Monday, setting off a rally in Greek assets.

Three senior officials said there had been a mix-up with the documents sent to the bailout monitors during the early hours of Monday morning.

“It’s not so dramatic, but they sent the wrong one by mistake,” said one of the officials.

European markets have been looking relatively rosy this morning, thanks to signs that a deal between Greece and its creditors to save it from default and an exit from the euro may be nearing a “forceps delivery”.

The revised version of the proposal by Greek Prime Minister Alexis Tsipras drew a rare positive nod from European officials ahead of marathon talks on Monday, setting off a rally in Greek assets.

With time and money running out for a solution to avert a devastating default, the European Central Bank also approved additional emergency funding for Greek lenders which have been bleeding deposits at a record pace, according to a person familiar with the matter.

Speaking in Brussels, Tsipras said that now it’s time for a viable solution that will allow Greece to return to growth.

“We’re are coming to these discussions aiming to strike a financially sustainable agreement aiming to leave behind the exaggerated primary surpluses, to save pensions and wages,” Tsipras told reporters ahead of a meeting with Jean-Claude Juncker.

While the new offer "was a good basis for progress," and a "step in the right direction," according to European Economic Affairs Commissioner Pierre Moscovici, it was unclear that the plan presented by Greece would go far enough to end a months-long impasse and avert a Greek default at the end of the June.

"We have made progress over the last few days, but we are not yet there," European Commission President Jean-Claude Juncker said.

“I don’t know if we will have an agreement today,” Juncker told press conference with Tsipras in Brussels before Monday’s talks.

An International Monetary Fund official said that creditor institutions are still assessing Greece's proposals and it's too early to say whether they are sufficiently credible to break the deadlock.

Greek bonds and shares rallied on Monday on confidence that a deal is within reach.

Bloomberg