Greek PM to resign

ATHENS. — Greek Prime Minister Alexis Tsipras was expected to resign yesterday to pave the way for early elections on September 20, government officials said, hoping to quell a rebellion in his leftist Syriza party and seal support for a bailout programme. Tsipras’ decision to return to the ballot box after seven bruising months in power deepens political uncertainty on the very day Greece began receiving funds under its third bailout programme with foreign creditors.

But a snap election should allow Tsipras to capitalise on his popularity with Greek voters before the toughest parts of the programme begin to bite, and may allow him to return to power in a stronger position without anti-bailout rebels in his radical left Syriza party to slow him down.

Greek two-year bond yields jumped 78 basis points to 12,15 percent, while Greek stocks closed down 3,5 percent.

“The aim is to hold elections on September 20,” a government source said after Tsipras held talks with his advisers. The leftist leader was expected to make a televised address at 8 pm local time (1700 GMT).

Tsipras had long been expected to seek early elections in the autumn to consolidate his position after caving into the creditors’ demands for more austerity and economic reform in return for $96 billion in bailout loans.

But he was forced to move quickly after nearly a third of Syriza lawmakers refused to back the programme in parliament last week, robbing him of a guaranteed political majority.

Greece’s complex constitution has special stipulations for holding elections less than 12 months after the previous vote, meaning the president must first consult other major parties to see if they can form a government —a highly unlikely option.

Hugely popular among his supporters for trying to stand up to euro zone and IMF creditors and with the opposition in disarray, Tsipras is widely expected to return to power. — Reuters.