A GREEK exit from the Eurozone is a real possibility, experts are warning.
A day after new prime minister of Greece Alexis Tsipras laid out plans to dismantle the country's austerity programme, the yield on Greek government bonds rose and stocks fell.
Eurozone finance ministers - including Michael Noonan - are due in Brussels for an emergency gathering tomorrow to discuss the way forward for the country, and listen to Greek minister Yanis Varoufakis in his first appearance before them.
The Greek government and Eurozone leaders have struck a defiant tone, with Mr Tsipras insisting his country would not extend its bailout and Germany saying it would get no more money without such a programme.
Eurogroup chair Jeroen Dijsselbloem has ruled out providing Greece with a bridging loan to keep the country afloat while it renegotiates the terms of its bailout.
Gary Jenkins, who is chief credit strategist with ING Capital, said the risk of a so-called 'Grexit' has now increased from 35pc to 50pc.
"It seems nonsensical that Greece could end up leaving the eurozone because they could not agree with their European partners on the best way to get through the next few weeks to allow them to spend time negotiating, but that is a realistic possibility," he said,
"If Greece's partners finally feel that they are just throwing good money after bad and that the Greek government's demands are just too much, then it is likely that they will stick to the 'no extension - no bridge loan' mantra.
"It is likely that there are some advisers to Ms Merkel whispering in her ear that to give in to Greece would only encourage the others," Mr Jenkins added.