Greece Risk Timeline -- Why July 20 Matters Most

Greece probably has until late July to come to an agreement with its creditors before potentially being forced out of the monetary union. Possible delays in payments to the International Monetary Fund in June shouldn’t prompt the European Central Bank to shut off vital liquidity to Greek banks. By contrast, a default on marketable debt -- specifically the failure of the Greek government to pay 3.5 billion euros due to the ECB on July 20 -- would probably force the central bank’s hand. The Greek government and its creditors are still likely to reach a deal on a list of reforms before that crucial date.

June 5: Greece will have to make a payment of about 240 million SDRs to the IMF. That equals about 303 million euros. Greek Finance Minister Yanis Varoufakis has stated Greece will seal a deal with its creditors by this date. This is a medium-risk event. The raid from Greece’s own reserve account at the IMF to make a recent payment to the fund suggests the Syriza-led government is running out of cash to pay its creditors and will be unable to make this payment in the absence of additional bailout funds, though the immediate consequences of missing a payment to the IMF would be limited.