"Greece is expected to submit today a request for a 6-month extension of its current loan agreement i.e. not the current bailout programme, along the lines of the so-called Moscovici draft, which was initially presented to the Greek FinMin on Monday (reportedly having also the support of EC’s President Mr. Juncker) but later withdrawn and replaced with another document that the Greek FinMin denied to sign.Let's see if this has legs or not!
In this original draft, the exact phrasing was: “The above forms a basis for an extension of the current loan agreement, which could take the form of a [four-month] intermediate programme, as a transitional stage to a new contract for growth for Greece, that will be deliberated and concluded during this period”.
The first reaction of Berlin was negative with FinMin Schaeuble saying that there is no loan agreement with Greece but a bailout programme and the issue is whether the programme will be concluded or not.
Greece is willing to agree to a moratorium on any steps that could affect the country’s fiscal targets and is ready to discuss other measures but is not willing to adopt the terms of the existing bailout programme. In other words, the request for the extension is designed to be disengaged from the obligation of the current bailout programme as the Greek government already announced yesterday a series of social reform measures which will be tabled to the parliament tomorrow.
The proposal is due to be sent to Eurogroup chief Mr. Dijsselbloem today and he will then decide if it merits calling an extraordinary Eurogroup on Friday, 20 February.
Greece΄s government confirmed it would ask on Wednesday for an extension to its loan agreement with the euro zone, which it distinguishes from its full bailout program.
"Let΄s wait today for the request for an extension of the loan contract to be submitted by Finance Minister (Yanis) Varoufakis," government spokesman Gabriel Sakellaridis told Greece΄s Antenna TV."
Some in the media are claiming that Greece has "blinked first".
The Greeks are asking for money but they are not offering to agree to any of the conditions set by the Eurozone wrt lending more money.
Irrespective of whether this headline balloon gains any real traction, Greece is running out of money and will have to impose capital controls.