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BOE's Kohn says it's likely Greece and EU will agree on debt
[LONDON] The risk that Greece and other euro-area countries disagree on measures to solve the nation's debt crisis is "small but not zero," said Bank of England official Donald Kohn, a former Federal Reserve vice chairman.
"My expectation is that Greece and the eurozone members and the IMF all work together for an agreement," Mr Kohn, a member of the BOE's Financial Policy Committee, told lawmakers in London Tuesday.
"And I think we've heard some language that suggests a little bit of progress, a little bit of give. There's enough pressure on both of them."
"In a tense situation like this, people are maneuvering, accidents happen, things happen that aren't intended, or people get pushed into corners," Mr Kohn said.
Greek stocks and bonds rallied after Finance Minister Yanis Varoufakis outlined plans to swap some Greek debt owned by the European Central Bank and the European Financial Stability Facility for new securities.
He indicated that the move would allow Greece to avoid imposing a formal haircut on creditors, according to a person who attended the meeting and asked not to be identified because they weren't authorized to speak publicly.