From The Guardian UK: http://www.guardian.co.uk/world/2012/may/14/euro-single-currency-greece
Return to drachma nears amid political impasse in Athens and open discussion in Brussels of possible end of single currency
Financial markets are hastily making preparations for a Greek exit from the euro after a day of political and economic turmoil ended with Europe‘s policy elite admitting for the first time that it may prove impossible to keep the single currency intact.
With attempts in Athens to form a government after last week’s election looking increasingly doomed, European leaders abandoned their taboo on talking about the possibility that Greece might have to leave the euro.
Shares, oil, and the euro were all sold heavily on Monday in anticipation that anti-austerity parties would garner support in a second Greek election likely to be held next month, bringing the row between Greece and its European creditors to a climax.
Critical talks are scheduled to continue in Athens between all party leaders, although President Karolos Papoulias’s decision to prolong the negotiations came despite widespread signs the talks were heading towards collapse. He has until Thursday, when the Greek parliament reconvenes, to broker a deal.
The British chancellor, George Osborne warned that the prospect of Greece crashing out of the euro was damaging economies across Europe.
Uncertainty over the future of struggling eurozone nations was having a “real impact” on growth, he said.
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