Fears that Greek banks and ATMs may shut prompt warnings from travel advisersHolidaymakers heading to Greece over the next few days are being advised to take plenty of cash with them amid fears the country’s cash machines could be shut down if a resolution to the crisis is not found.Related: Greek crisis: ECB meeting to decide on €3.5bn emergency fundingRelated: Greek crisis: ECB deciding on new lifeline for Greece - live updates Continue reading...

End Austerity Now, a demonstration organised by The People’s Assembly, is taking place in London this weekend. Taking part? Share your photos and stories

The chancellor, George Osborne, urges Greece on Friday to strike a deal with its international creditors in loans-for-reforms talks, adding that the UK is hoping for the best but preparing for the worst. Speaking as he arrives for a meeting of the European Union's finance ministers in Luxembourg on Friday, Osborne says Britain has taken measures to increase economic security in case Greece exits the eurozone Continue reading...

Thousands of Greeks gather in Athens in support of EU membership as eurozone ministers fail to reach a deal and announce an emergency meeting. The demonstration was held one day after a rival protest by supporters of the ruling Syriza party, who are urging the government to reject creditor demands for pension cuts and VAT hikes in exchange for vital financial support. Default and capital flight could lead to Greece's exit from the eurozone Continue reading...

George Osborne still expected to press ahead with steep cuts to welfare budgets and WhitehallGeorge Osborne is on track to cut the annual budget deficit by more than previously forecast after a block on spending and a jump in tax receipts in May.The Office for National Statistics said government borrowing last month dropped to £10.1bn, the lowest since 2007, from £12.3bn in May last year – an 18% fall. The total stock of debt, excluding public sector banks, was £1.5tn or 80.8% of GDP, an increase of £83.2bn compared with May 2014.

Financial exposure to the risk of Greece defaulting on its €320bn debt affects eurozone member states and foreign banks. How will it all play out?Greek crisis - live updatesGreece says it will run out of money at the end of the month if a deal with its creditors the European commission, the European Central Bank and the International Monetary Fund cannot be reached.Related: Greek crisis: Emergency meetings as bank fears grow - live updatesRelated: Eurozone talks end without deal as Greek proposals rejectedBarclays: Official exposure to Greece in EMU by country and type pic.twitter.com/5QKkrsWr77 Continue reading...

Emergency summit of leaders called for Monday as fears rise for Greek financial system if a deal cannot be reachedGreece is facing a full-blown banking crisis after a meeting of eurozone finance ministers broke down in acrimony and recrimination on Thursday evening, bringing the prospect of Greek exit from the eurozone a step nearer.Related: Eurozone talks end without deal as Greek proposals rejected Continue reading...

The president of the Eurogroup Jeroen Dijsselblom appeals to the Greek authorities to submit further proposals in the hope of a financial deal, after previous measures were judged to be lacking in 'credibility and seriousness'. Greece must reach a new deal with its creditors by 30 June or risk defaulting on its debts, but talks broke up early on Thursday with no agreement in sight Continue reading...

Oxford-educated economist is well qualified as the point man in negotiations between Athens and international creditorsFor those who thought the battle to save Greece was all about a rag tag bunch of leftists finally seeing the light, Euclid Tsakalotos has made many think again.At the eleventh hour, the Oxford-educated economist has emerged as Athens’ secret weapon, sounding every inch the man he was raised to be: a public school member of the British establishment. “It is rather surprising to the other side,” he says, the Greek parliament framed in the window of his eighth floor office. “But so, too, is the fact that I understand their economic arguments.” Phlegmatic, professorial, mild-mannered, Tsakalotos has spent the best part of 30 years in the ivory towers of Britain and Greece “engaging critically” with neoclassical economic thinking.Related: Eurozone talks end without deal as Greek proposals rejected Continue reading...

Finance ministers have given a “strong signal” to Greece to engage seriously, as crisis escalates again

The Greek economy would be better off outside the euro, say some, but devaluation may only work in countries with thriving trading partnersThere is a beguiling argument that life for Greece outside the eurozone wouldn’t be so bad. Sure, the immediate economic pain would be severe, but a new drachma, coupled with debt default, might deliver a whoosh of relief in time. Isn’t history full of countries that have devalued their way out of crisis by generating an export boom? Didn’t Argentina recover that way when it abandoned its currency peg to the US dollar in 2002?Taken to its logical extreme, this argument says the real threat to the survival of the eurozone is that Greece leaves and prospers. Come the next crisis, other strugglers might opt to quit, dumping their debts as they go. Continue reading...

What would the effects be of a Grexit and is it the worst scenario for the eurozone?Why is a Greek deal so urgent?

Meeting called for Monday as finance ministers still cling to hopes for a deal after brittle summit ends without agreement on debt crisisTalks to end the debt crisis that has engulfed Greece broke up early on Thursday, despite Athens presenting a raft of new reform proposals to eurozone finance ministers in a bid to secure a deal. A summit of eurozone leaders was immediately called for Monday in a bid to find a solution to the mounting crisis.The Greek finance minister, Yanis Varoufakis, talked for half an hour at the Luxembourg meeting and distributed a five-page memorandum of fresh policy changes, according to sources at the meeting, but failed to persuade the debt-stricken country’s creditors that they could form the basis for an agreement.Related: 'Making us poorer won't save Greece': how pension crisis is hurting its peopleRelated: Greece says it will run out of money by end of month without bailout deal Continue reading...

Retail sales figures, which don’t include restaurants, hotels and foreign travel, show just a 0.2% increase on previous monthThe petrol price dividend from price falls at the pumps is being spent on eating out, trips abroad and short breaks to Britain’s growing number of boutique hotels.That appears to be the message from May’s retail sales figures, which don’t cover restaurants, foreign travel and the hotel trade and ticked up just 0.2% on the previous monthThe UK’s economic growth remains unbalanced and is too reliant on consumer spending Continue reading...

Economics editor Larry Elliott assesses Thursday's negotiations between Greece and the International Monetary Fund. Finance ministers from across the eurozone have converged on Luxembourg to discuss the state of Greece's economy, which has less than a fortnight to reach a deal with creditors before its bailout expires. Who has the biggest headache? Angela Merkel, the German chancellor ... or Alexis Tsipras, Greece's prime minister? Continue reading...

Christine Lagarde, the head of the International Monetary Fund (IMF), says on Thursday that Greece has no chance of a 'grace period' over its €1.6bn repayment due to the IMF on 30 June. Lagarde's comments come as finance ministers from across the eurozone have converged on Luxemberg to discuss ways to resolve the crisis amid fears of Greece's possible exit from the single currency Continue reading...

Everyone from the president to trade analysts can speculate on what the Trans-Pacific Partnership will mean for the US economy, but the simple fact remains: no one can see the futureAfter all the shouting, are we any closer to knowing whether free trade agreements are good or bad for the country – and for your wallet?The attempts to provide answers to those questions have been thrust into the spotlight by President Barack Obama’s futile last-minute efforts to salvage his power to freely negotiate what would be the world’s largest free trade pact, the Trans-Pacific Partnership. Continue reading...

German chancellor tells Bundestag the Greek government failed to honour commitments made with lenders to implement structural reformsAngela Merkel has delivered an unusually sharp rebuke to the Greek government, accusing it of failing to implement necessary structural reforms while insisting a last-minute deal was still possible to keep it in the eurozone.

This neighbourhood was unfairly identified as ground zero for the foreclosure crisis. Eight years later, it’s coming back up – without the help of federal fundsWhen Anthony Trzaska hears the words “Slavic Village” in news reports, he knows what is coming next. “It’s almost like when the media reports anything on Slavic Village, it’s followed with: ‘Comma, where the foreclosure crisis in America started,’” says the 31-year-old resident. “It’s not like the foreclosure mess didn’t happen. But it didn’t just happen here.”Cleveland’s Slavic Village is widely perceived as the epicentre of the Great Recession. In 2007, when the media finally realised that the housing bubble was bursting wide open (about two years after 48 states had sued subprime lender Ameriquest for fraudulent loan practices), a few journalists decided to run some zip codes to see where the most foreclosures were happening. Continue reading...

Report notes numbers of people relying on food banks has doubled in a year and criticises ‘lack of progress’ regarding 23% of Welsh population living in povertyThe Labour-led Welsh government has been severely criticised by an assembly committee for its “lack of progress” in reducing poverty.Women, children and refugees are among the groups who have been particularly badly affected, according to a damning report published on Thursday. Continue reading...

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Central bank issues chilling warning that Greece could be thrown out of the European Union unless it reaches a deal fast

Head of European parliament says Grexit from euro may also mean leaving EU as Athens admits it cannot pay IMF and Brussels expresses little hope in final talks

Athens is staring down a tunnel with only a glimmer of light. Europe confronts a scenario of total darkness. Dropping some of the debt is the only way to avoid itGreece could soon steer into a long, dark tunnel with only the faintest glimmer of light at the end. If it doesn’t pay the IMF at the end of this month, finance for its banks could be cut off, forcing Athens to print a new currency. Outside the euro, Greece could find itself without the means to pay for basic imports like fuel and medicine. After a while inflation should start to eat into debts, and a cut-price drachma should lure extra tourists: therein lies that glimmer of light. The difficulty, however, is that to lock in its new competitive edge, Greece would have to run its economy well and increase the efficiency of its industry. If it can’t do these things, and its current predicament hardly inspires confidence, then the relief of devaluation would soon give way to panic about inflation.At least Greece understands that it is approaching a moment of destiny. Europeans elsewhere – who have not suffered a comparable economic collapse or the concomitant spike in suicides – may not realise that they are perched on an ominous brink. Some say that, unlike in 2011, a Greek exit could today be managed. After all, the fire-fighting funds scrambled together back then are now on a permanent footing. Eurozone output is today growing, not shrinking. There are even signs of one or two of the peripheral countries once dismissed as the PIIGS beginning to fly. Greece’s creditors are today essentially public institutions, and so – the voices of complacency continue – there is no longer the same risk of contagion in private markets. They point, too, to the eurozone bond-buying scheme, formally approved by the EU’s top court in Luxembourg this week, which stands ready to douse down the panic that would flare up. Continue reading...

Young couples need ‘pristine’ credit scores as US home ownership rates hits lowest level since 1989 but Fed remains committed to raising interest rates this yearYoung couples are delaying getting married because they are finding it so hard to get a mortgage to buy their first home, Janet Yellen, the chair of the Federal Reserve, warned on Wednesday as she once more signaled a historic rise in interest rates later this year.Yellen said people were finding it so hard to secure credit from banks that “people [are] delaying marriage [because they] can’t get mortgages as easily”. She said that it is still too difficult for people to get a mortgage unless they have “pristine” credit scores. Continue reading...

Greece warns of ‘uncontrollable crisis’ without a deal with creditors. Meanwhile, in the UK a glitch at RBS causes delays in payments, sparking anger among customers Continue reading...

This is a crunch week for the Greek debt negotiations, and could be decisive for the country’s membership of the eurozone. Day by day and meeting by meeting, we outline how the crisis could play out Continue reading...

The legal basis for forcing a member out is shaky: the European commission needs to debunk the ‘Grexit’ assumption and rediscover its role as guardian of the treatiesMonths of arguments about the Greek financial crisis have this week cumulated in a highly emotional debate about a possible Grexit. As Athens will be unable to satisfy its financial obligations after a default, many hardliners expect Greece to leave the eurozone, and printing as much neo-drachma as necessary. Some see this as the only solution to the Greek crisis: it would allow Greece to devalue its new currency, supposedly making the country competitive and resulting in economic growth and the ability to repay its debt. Others are more sceptical: they fear that the new drachma would be an obstacle to trade, increasing the cost of imports and making it impossible for Greece to ever repay anything.Related: Greece crisis: US urges compromise after Greek PM attacks IMF - as it happenedAccording to the EU treaty, its aim is to promote peace and the wellbeing of its peoples Continue reading...

Greece’s prime minister says the financial institution has ‘criminal responsibility’ for the damage caused by the country’s austerity programmes Continue reading...

Concerns that jump in real wages, highest in seven years, will be short lived if inflation continues to rise over rest of 2015 and productivity remains flatWage growth in Britain hit a four-year high of 2.7% in April, according to official figures, delivering a welcome increase to household finances following the fall in inflation this year.But some analysts warned that the jump in real wages, the highest for seven years, would be short-lived if inflation continued to rise over the rest of the year and productivity remained flat.Related: Enjoy rising wages while they last – it won't take much to slow things down Continue reading...

British chancellor George Osborne says government is taking ‘all steps’ to protect Britain amid fears that Greece is on verge of debt defaultThe British government is stepping up contingency planning to prepare for the “serious economic risks” posed by a Greek default and a possible exit from the euro, Downing Street has confirmed.

Tsipras’s abrasive tone and accusations of ‘criminal conduct’ by IMF stokes more anger as EU officials prepare to gather at Luxembourg last chance saloonFears that the five-year Greek financial crisis will culminate in debt default and exit from the euro have intensified as Athens hardened its rhetoric against its creditors and insisted it would miss a payment to the International Monetary Fund unless it received debt relief.With just 48 hours to go before a meeting of eurozone finance ministers, seen as the last realistic chance to reach a deal before Greece has to pay the IMF at the end of June, Alexis Tsipras, showed no sign of bowing to demands for cuts in pensions and increases in VAT. Instead, the Greek prime minister accused the Fund of “criminal responsibility” for the situation and said lenders were seeking to “humiliate” his country.Related: Tsipras does want a deal, as the alternative is unthinkableRelated: Angela Merkel stands firm on finding resolution to Greece crisisRelated: Eurozone braces for Greek exit as Athens threatens to miss IMF payment Continue reading...

Greece’s spiralling debt crisis saw cash withdrawals total €400m on Monday. While anxiety varies around Athens, few Greeks see benefit in leaving the euro“Everybody’s doing it,” said Joanna Christofosaki, in front of a Eurobank cash dispenser in the leafy Athens neighbourhood of Kolonaki. “Our friends have all done it. Nobody wants their money to be worthless tomorrow. Nobody wants to be unable to get at it.”A researcher in the archaeology department at the Academy of Athens, Christofosaki said she knew plenty of people who had “€10,000 somewhere at home” and plenty of others who chose to keep their stash at the office. Was she among them? “If I was, I certainly wouldn’t tell you.”Related: Greece crisis: Tsipras blasts 'criminal' IMF in defiant speech - live updatesRelated: Tsipras does want a deal, as the alternative is unthinkableRelated: Greece's latest attempt to reach deal with creditors collapsesRelated: Endgame looms for Greek crisis as both sides take debt negotiations to the brink Continue reading...

Greece would face unprecedented hardship if capital controls were introduced, and the Syrizia party would see its populist support plummet rather fastHard though it is to believe sometimes, Alexis Tsipras does want to strike a deal. The increasingly abrasive language used by the Greek prime minister is a front for a politician who still thinks it is possible to negotiate his way out of the sticky situation he finds himself in.That has to be the assumption. The alternative to a deal would appear to be a Lehman Brothers-style moment sometime in the next 72 hours, when the Greek banks haemorrhage money and capital controls are introduced. At that point, support for Tsipras and his Syriza coalition is likely to dissipate rapidly, especially if Greece’s eurozone partners say capital controls are incompatible with membership of the single currency.Related: Greece crisis: Tsipras blasts 'criminal' IMF in defiant speech - live updatesRelated: Angela Merkel stands firm on finding resolution to Greece crisisRelated: Eurozone braces for Greek exit as Athens threatens to miss IMF payment Continue reading...

Consumer price index measure of inflation was up 0.1% on a year earlier in May after a 0.1% dip in AprilBritain’s brief flirtation with negative inflation ended last month, with official figures showing that prices rose again in May helped by higher air fares and petrol prices.The Office for National Statistics said its consumer price index measure of inflation was up 0.1% on last year after a 0.1% dip in April – the first negative inflation for more than 50 years.Read the Chancellor’s statement on today’s #inflation figures: pic.twitter.com/xrrSARPz4p Continue reading...

Chancellor clashes with her finance minister and German media over hardline stance regarding potential GrexitWhile the German chancellor, Angela Merkel, is publicly insistent on reaching a compromise deal that ensures Greece is saved from insolvency, expectation is rising – in Germany and elsewhere – of a Greek exit from the eurozone. With just two weeks to go for Athens to find a solution to creditors’ cash-for-reforms demands for a 1.6 bn euro repayment to the International Monetary Fund, a Greek default – and a Grexit with it – are viewed in Berlin as ever more likely.Related: Greece crisis: PM blasts 'criminal' IMF in defiant speech - live updatesRelated: Greek crisis: Europe has nothing to fear from Syriza's belligerence Continue reading...

Protest group accuses leadership contenders of being timid, and indicates support for Jeremy Corbyn’s bid ahead of Saturday’s marchThe organisers of an anti-austerity demonstration planned for the City of London this weekend have accused three of the four Labour leadership contenders of timidity for deciding to stay away.The End Austerity Now rally, organised by the People’s Assembly, is expected to be the biggest anti-government demonstration for four years; tens of thousands of people will march from the City of London to Parliament Square.Jeremy is the only candidate who takes a principled anti-austerity, anti-war stance consistently Continue reading...

Greece’s prime minister Alexis Tsipras says the fixation on cuts is ‘most likely part of a political plan to humiliate an entire people’Greece’s prime minister has said the International Monetary Fund has “criminal responsibility” for the country’s debt crisis as it emerged Athens could miss a €1.6bn (£1.15bn) payment to the lender this month.Speaking in the Greek parliament Alexis Tsipras called on creditors to reassess the IMF’s insistence on tough cuts as part of the country’s bailout. Continue reading...

There is still a risk that inflation could go negative again over the next couple of monthsWell, that didn’t last long. A month after the cost of living turned negative for the first time in more than half a century, inflation was back.In truth, there is little difference between the fact that prices on the government’s preferred measure fell by 0.1% in the year to April and that they rose by 0.1% in the 12 months ending in May. Inflationary pressure remains weak and is likely to remain so.Related: Inflation returns to UK as airline tickets and petrol prices rise Continue reading...

Crisis in Europe is just the latest example of the high costs – for creditors and debtors alike – entailed by the absence of an international rule of law for resolving debt crisesGovernments sometimes need to restructure their debts. Otherwise, a country’s economic and political stability may be threatened. But, in the absence of an international rule of law for resolving sovereign defaults, the world pays a higher price than it should for such restructurings. The result is a poorly functioning sovereign-debt market, marked by unnecessary strife and costly delays in addressing problems when they arise.We are reminded of this time and again. In Argentina, the authorities’ battles with a small number of “investors” (so-called vulture funds) jeopardised an entire debt restructuring agreed to – voluntarily – by an overwhelming majority of the country’s creditors. In Greece, most of the “rescue” funds in the temporary “assistance” programs are allocated for payments to existing creditors, while the country is forced into austerity policies that have contributed mightily to a 25% decline in GDP and have left its population worse off. In Ukraine, the potential political ramifications of sovereign-debt distress are enormous. Continue reading...

Alexis Tsipras thinks he holds another trump card: Europe’s fear of a Greek default. But this is a delusion promoted by his finance minister, Yanis VaroufakisThe good news is that a Greek default, which has become more likely after prime minister Alexis Tsipras’ provocative rejection of what he described as the “absurd” bailout offer by Greece’s creditors, no longer poses a serious threat to the rest of Europe. The bad news is that Tsipras does not seem to understand this.To judge by Tsipras’s belligerence, he firmly believes that Europe needs Greece as desperately as Greece needs Europe. This is the true “absurdity” in the present negotiations, and Tsipras’ misapprehension of his bargaining power now risks catastrophe for his country, humiliation for his Syriza party, or both. Continue reading...

Official figures due on Tuesday are expected to show Britain’s dip into negative inflation ended in May, as rising fuel costs pushed prices up againBritain’s brief flirtation with negative inflation came to an abrupt end last month, according to a Reuters poll of economists, with official figures expected to show prices started rising again in May.April saw prices fall on a year ago for the first time in more than 50 years. The Office for National Statistics said its consumer price index measure of inflation was down 0.1% in April. But economists believe May’s figures, due at 9.30am on Tuesday, will show inflation rebounded as fuel prices rose. The consensus forecast is for inflation of 0.1% last month, according to Reuters.Related: UK wages rising at fastest rate since October 2007, thinktank says Continue reading...

This isn’t just Bullingdon Boys running amok – they’re using austerity to transform irrevocably our politics, our public realm and our societyEver since the crash of 2008, every economic argument worth having has been political. Rows over what to do about Greece or bankers may come swathed in a tarpaulin of jargon, or bearing a roof-rack of technicalities, but really they’re about the big stuff: who gets what and from whom, and what makes a society worth living in.Which makes austerity the biggest political debate in Britain today. Last week George Osborne vowed at Mansion House to make budget deficits all but illegal; next weekend there will be a national demonstration against the cuts. These events will look very different – a bunch of penguin suits discussing finance over a slap-up dinner versus an army of trainers tramping in protest at the human fallout of the past five years. Yet they are the yin and yang of the debate over what kind of country the UK should be.Related: Academics attack George Osborne budget surplus proposalWhat we expect from Whitehall or our town halls will come instead from G4S, Serco, Atos Continue reading...

Dramatic day sees traders are spooked by collapse of negotiations last night, PM Alexis Tsipras vows not to cave in, and German media reports of an emergency ultimatum.

If Greece gives in to the demands of the European banks and the IMF, the consequences for its pensioners and other poor people will be worse than anything Draco ever dreamt up. The pensions cut and the VAT increase are favoured by the banks because there will be an immediate impact on those perceived to have benefited immoderately from the government’s profligacy – a benefit not clear to people whose country has already been devastated by cuts.If the banks give way, however, who will notice? No one in the short term. In the long term, maybe the banks or hedge fund managers may have to adjust their books to reflect a bad investment.Related: Fears of Greece eurozone exit mount as EU deadline loomsRelated: Europe must save Greece to save itself | Timothy Garton Ash Continue reading...

Ha-Joon Chang, Thomas Piketty and 77 others argue (Letters, 12 June) that there is “no basis in economics” for George Osborne’s plans to legislate for budget surpluses. This is reminiscent of the phrase used by the 364 economists who wrote to the Times arguing that there was “no basis in economic theory or supporting evidence” for Geoffrey Howe’s policies. The credibility of that group was not helped when growth returned the next month. Though I have reservations about Osborne’s proposal, to argue that “there is no basis in economics” for constitutional or legislative rules that constrain government borrowing, especially given the ageing of the population, is simply wrong. Furthermore, the specific complaints of the correspondents are based on the shakiest of assumptions, not least that there is no foreign sector in the economy that can absorb the impact of changes in government borrowing.Related: Osborne plan has no basis in economics | Letter from Ha-Joon Chang, Thomas Piketty, David Blanchflower and others Continue reading...