Day of Triffin

27 January 2010 By John Foley Follow @johnsfoley

With $2.4 trillion in foreign reserves, China could easily afford to bail out the troubled EU state. High bond yields and influence over Greek shipping may appeal and Greece only needs $40 bln or so this year. If only all of China’s currency kitty could be housed so easily.

This content is for Subscribers only

Context News

Goldman Sachs held preliminary talks over a Chinese state investment in Greek sovereign debt, according to a person familiar with the situation. Talks were at an early stage, and no proposal had been presented to the Greek government.

Greece sold 25 billion euros in fiveyear bonds through a public auction on Monday, with a yield of 6.2 percent around twice the yield on regular euro bonds, and a 0.3 percentage point premium on other Greek debt of a similar maturity.

The EU country's credit rating was cut in December by Standard & Poor's and Moody's over concerns about a fiscal deficit of some 13 percent of GDP. Greece aims to bring this ratio down to 3 percent by 2012, and requires around 50 billion euros of funding in 2010.

Email a friend

Please complete the form below.

Required fields *