Greek bailout deal: Still not quite there yet

Greek political leaders settled their differences on an austerity plan on Thursday but still couldn't get the required bailout. From Reuters:

Greek political leaders said they had clinched a deal on economic reforms and spending cuts needed to secure a second bailout, but euro zone finance ministers demanded more measures and a parliamentary seal of approval before providing the aid...

Jean-Claude Juncker, who chairs the Eurogroup, set three conditions, saying the Greek parliament must ratify the package when it meets on Sunday and a further 325 million euros of spending reductions needed to be identified by next Wednesday, after which euro zone finance ministers would meet again.

"Thirdly, we would need to obtain strong political assurances from the leaders of the coalition parties on the implementation of the program," Juncker told a news conference after six hours of talks in Brussels. "Those elements needs to be in place before we can take decisions."

"In short, no disbursement before implementation."

There is a possibility, though, that the European Central Bank could help Greece. Again from Reuters:

European Central Bank President Mario Draghi opened the door on Thursday to helping Athens indirectly after Greek politicians finally signed up to an austerity package following days of dither and delay...

After the ECB left interest rates at a record low 1.0 percent, Draghi spent much of his hour-long news conference refusing to show his hand, before indicating at the very end that the bank could pass profits from its Greek bonds to euro zone countries.

The countries could then funnel the money to Greece. The ECB is forbidden from financing governments directly.

Also likely to help ease the sovereign debt crisis generally will be the ECB's second offering of three-year loans that will come with rules that expand the range of assets eligible as collateral.

Somewhat more direct in easing monetary conditions has been the Bank of England. On Thursday, it added 50 billion pounds into its bond buying programme despite a 0.5 percent increase in industrial production and a narrowing in the trade deficit.

Indonesia's central bank also eased monetary policy on Thursday, cutting its benchmark interest rate to a record low of 5.75 percent.

China, though, may be slow in easing monetary policy after its inflation rate rose to 4.5 percent in January, the highest level in three months.

Elsewhere in Asia, there were mixed data from Japan. Core machinery orders fell 7.1 percent in December but the consumer confidence index rose to 40.0 in January from 38.9 in December.