Greece ‘Won’t Bury Democracy in Place Where it was Born’

New Delhi: European markets fell on Monday due to the gloomy mood regarding negotiations with Greece, and a report by the European Central Bank president Mario Draghi, giving evidence in the European Parliament. Draghi has said that a solution to the Greece issue needs to be found immediately, but that the ball is firmly in Athens’s court itself. The ECB president however said that there will be no immediate loss of support from the Bank to Greece, even though relationships between Greece and its creditors, including the EBC have soured over the talks, the Guardian reported.

Greece meanwhile has remained firm regarding its stand on the issue. While creditors are demanding ‘reforms’ in the country’s economy – a euphemism for austerity – Prime Minister Alexis Tspiras has said he cannot give in to demands to reduce state pensions, or reform VAT, or water down plans of introducing a new set of labour law reforms in the country.

File photo of Alexis Tsipras  by Robert Crc. Licensed under FAL via Wikimedia Commons.

File photo of Alexis Tsipras by Robert Crc. Licensed under FAL via Wikimedia Commons.

“We do not have the right to bury European democracy at the place where it was born,” the Guardian reported him as saying to the Greek newspaper Efimerida ton Syntakton. Bank indices and equity indices fell sharply in Greece with the FTSE Bank Index down by 8 per cent. The German, French and Italian indices all fell over 2 per cent, and the British FTSE closed on a three month low, down by 1.1 per cent.

Meanwhile, in South America, economic indicators in Brazil continued to worsen, as a report released by the Central Bank there on Monday revised the inflation estimates for 2015 significantly, from 8.46 per cent to 8.79 per cent. Analysts have also predicted a deterioration in industrial production, and the country’s GDP. The GDP contraction estimate has been increased from 1.3 per cent to 1.35 per cent. The 2016 inflation estimate however, has remained unchanged at 5.5 per cent in the Report, the Rio Times reported.

Data has also come in from the United States and Israel indicating slowing economies. In Israel, after a sustained period of negative inflation, the Consumer Price Index has risen for three consecutive months, this time by 0.2 per cent. Inflation since the start of 2015 is still in the negative though, according to Israeli news agency Globes. In the US, industrial production declined for May on weakened global demand and a strong dollar, contrary to reports that had suggested that it would see a rise. The manufacturing industry is facing the weight of a strong appreciation in the dollar, the Wall Street Journal reported.