Greeks vote again

December 23, 2014

Greek Prime Minister Antonis Samaras is seen inside the parliament during Presidential vote

A second round of voting in the Greek parliament on the government’s nominee for president takes place today.

In the first round, Prime Minister Antonis Samaras secured the support of 160 of 300 lawmakers for his nominee, leaving him looking for 20 votes from independents and small parties to avoid snap national elections early next year which polls suggest anti-bailout Syriza would win. The winning line remains at 200 lawmakers but in the third round of voting on Dec. 29 it drops to 180.

Today’s vote will show whether Samaras has made any progress in winning over more doubters. Greek media reported that he could get 169 votes in the second round. Lawmakers in the ruling coalition said anything over 170 would be a success. Voting begins at 1000 GMT, with the result likely around an hour later.

There will doubtless be a furious bout of backroom wheeler-dealing over the next week but it looks like Samaras has played his last big card, offering to bring pro-European independents into the government and hold new elections in late 2015 if lawmakers back him to elect a new president.

Weekend opinion polls showed Syriza would beat the ruling conservatives if an election were held now but its lead has shrunk from last month. Syriza has recently taken a somewhat more moderate line but it is still avowed to write off much of Greece’s debt and reverse years of austerity just as the economy returns to growth, a stance that could see it shut out of the markets and back to square one.

A Greek prosecutor closed an investigation into allegations that a lawmaker was offered a bribe to back the government in the presidential vote, ruling there was insufficient evidence to support the accusation made by Pavlos Haikalis, a lawmaker from one of the small Greek parties whose backing the government needs to win.

Russia’s Vladimir Putin held telephone talks with his Ukraine counterpart, Petro Poroshenko, and Angela Merkel and Francois Hollande last night. Nothing much of note seems to have materialized though Poroshenko said a fresh round of peace talks involving Russia, Ukraine and the Organization for Security and Cooperation in Europe will be held in the Belarussian capital on Dec. 24 and 26.

Latest data show the Russian finance ministry sold another $420 million on Friday to shore up the rouble, which has opened about five percent stronger against the dollar this morning. Trade is still volatile and it’s early days but it should be noted that having traded around 35 per dollar for most of the year before shooting up to 80 at one point last week as support collapsed, the rouble is now back at around 55.

On Monday, the central bank announced the first bailout of the rouble crisis, providing up to $540 million to rescue Trust Bank and taking over supervision of the lender. Former finance minister Alexei Kudrin said his country was now in a full-blown economic crisis. It’s not clear that China’s offer of using the yuan to settle trade with Russia by expanding a currency swap arrangement will help very much.

Detailed releases of UK and French third quarter GDP are likely to confirm quarterly growth rates of 0.7 and 0.3 percent respectively. An equivalent U.S. report later is forecast to show annualized growth of 4.3 percent (about 1.1 percent if you equate it to the European readings).

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