Greek referendum: If 'No', risk large Grexit materializes - Rabobank

FXStreet (Bali) - Maartje Wijffelaars and Allard Bruinshoofd, Economists at Rabobank, notes that if the 'No' vote wins in Greece today, the risk is large that no deal will be agreed upon anymore and that Greece eventually leaves the Eurozone.

Key Quotes

"Referendum will not end uncertainty over Greek saga, making it unthinkable that Greek banks are reopened on Tuesday."

"The most promising scenario is the one in which the referendum results in a ‘Yesvote’ and Tsipras and Varoufakis resign. This still is the most likely scenario, though polls suggest it will be a close call."

"The most worrisome scenario is the one in which the referendum results in a ‘Novote’. In that case the risk is large that no deal will be agreed upon anymore and that Greece eventually leaves the eurozone."

"As long as the ECB continues to approve ELA, Greece will stay in the eurozone. ELA decisions are greatly conditional on the outlook for a deal and as such partly on the referendum outcome."

"A failure of the Greek government to repay the ECB EUR 3.5 bn the 20th of July, could but need not be the end of ELA. The decision is up to the ECB."

"Contagion to other eurozone countries following a Grexit should remain limited, at least in the short term."