An agreement to offer Greece a third bailout has been reached by Eurozone leaders.
After on-going talks in Brussels, which Greek prime minister Alexis Tsipras called a "tough battle", the head of the European Commission said that the risk of Greece leaving the eurozone had been "averted".
Greece has secured debt restructuring and a "growth package" and will have to pass the reforms demanded by the eurozone – including streamlining pensions, raising tax revenue and liberalising the labour market – by Wednesday (July 15th).
An EU statement said up to €86 billion (£61 billion) of financing would be available for Greece over a three-year period. It also included an order to reschedule Greek debt repayments "if necessary". However, there was no provision for reducing the Greek debt, which Athens had been seeking.
Commenting on the agreement, Jean-Claude Juncker, the chief of the European Commission said: "There will not be a 'Grexit'." There had been concerns that if a deal could not be reached, it would have meant Greece having to leave the euro.
He explained that this agreement was a compromise, with no winners or losers.
"I don't think the Greek people have been humiliated, nor that the other Europeans have lost face. It is a typical European arrangement," he said.
Mr Tsipras said he believed – and hoped – that the a Grexit was no longer a possibility, reports the BBC.
"The deal is difficult but we averted the pursuit to move state assets abroad. We averted the plan for a financial strangulation and for the collapse of the banking system," he said.
Mr Tsipras also said he had the "belief and the hope that… the possibility of 'Grexit' is in the past".
"The deal is difficult but we averted the pursuit to move state assets abroad," he said. "We averted the plan for a financial strangulation and for the collapse of the banking system."
Following the news of a Greek deal, shares in London and other key European markets went up. By midday Monday (July 13th), the FTSE 100 had gained 0.67 per cent or 45,012 points to trade at 6,718.40.
StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.
No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.