Late on Friday a report in Germany’s Der Spiegel indicated Greece was looking to leave the euro following a meeting of finance ministers in Luxembourg.
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Euro coin in front of the giant symbol of the Euro outside the headquarters of the European Central Bank.
The report moved the euro lower, adding to losses from Thursday when Jean-Claude Trichet had made dovish comments during the ECB monthly press conference.
Over the weekend, in keeping with the recent history of the euro zone debt crisis we got a denial from the Greek finance ministry and comments from Germany supporting such a move.
"If Greece were to exit from the euro zone, the country would be able to devalue its currency and become more competitive,” the head of the IFO institute, Hans-Werner Sinn, told Frankfurter Allgemeine Sonntagszeitung.
"If Greece instead were to try an 'internal' devaluation of between 20 percent to 30 percent by cutting wages and prices, it would probably come to the brink of a civil war," he added.
Then a member of Angela Merkel’s coalition government was quoted as saying “If Greece wants to leave the euro zone that is its own autonomous decision."
Later we got a denial from the German economy minister and then the Greek finance minister told reporters the talks had been about possible access to European Union funds over the next two years.
“The markets continue to disbelieve in our country,” Finance Minister George Papaconstantinou, said.
Carl Weinberg, the chief economist at High Frequency Economics told CNBC that talk of Greece leaving the euro is “plainly ridiculous.”
Having called for Greece to restructure its debt over a year ago Weinberg now believes Portugal, and possibly Ireland, will have to follow Athens' lead.
“We have warned that Greece has never really complied with the terms of its fiscal plan, and that a crisis like this was inevitable. Here it is,” said Weinberg.
“We expect an eventual multi-year restructuring of both Greek and Portuguese bonds, and probably Ireland’s bonds too.”
“Restructuring can happen either the easy way or the hard way. The easy way is via a planned restructuring program. The hard way what Greece is doing right now.”
“If sovereign borrowers are allowed the fail, all banks in euro land are at risk,” he warned.
