Greece, officially known as the Hellenic Republic, is a country in Southern Europe. Its capital is Athens. It has been part of the euro zone since 2001.
Importance in Forex:
Since the late 2009, worries of a sovereign debt crisis developed among investors. They were concerned that Greece won’t be able to meet its debt obligations due to the increase in government debt levels. This resulted in a crisis of confidence, indicated by the widening of borrowing costs and widening of bond yield spreads.
In April 2010, Greece’s debt was downgraded to junk, which led to a wide-spread panic in the financial markets. Then, in May 2, 2010, the euro zone countries together with the IMF agreed to give Greece a 110 billion EUR bailout. In February 2012, Greece was given another bailout amounting to 130 billion EUR with the condition that Greece must implement strict austerity and that Greek bondholders must agree to restructure their debt.