Economists warn Greek resolution will be short-lived

Abnormal volatility in European markets is set to continue despite moves by Greece to overcome hurdles after passing its austerity package last week.

Economists including Roger Bootle said the risk of contagion has not passed and Greek default is “inevitable” even though MPs passed laws to implement the austerity measures. Eurozone finance ministers met over the weekend to approve a €14bn loan to the debt-ridden nation at a meeting in Brussels. Ahead of the meeting, sentiment improved and global markets were buoyed as the austerity package was passed but economists warn rises may be short-lived as the likelihood of Greece defaulting on its €340bn debt payments is a “virtual certainty” at some point in the next few years. Bootle,...