As ECB policymakers prepare to meet on Wednesday, the ongoing Greek crisis threatens to cast doubt over the region's improving economic picture. Ciara Lee reports.
Time is running out and Greece is not moving fast enough - that's the conclusion of the European Commission Vice President. The mood between Greece's leftist government and its euro zone partners has been tense during negotiations. And a eurogroup meeting on 24th April will decide whether the cash-strapped country gets further and much needed financial aid. Greece has denied a report in the Financial Times that it is preparing for a debt default if it does not reach a deal by the end of the month. JP Morgan's Patrik Schowitz. (SOUNDBITE) JP MORGAN MARKET STRATEGIST, PATRIK SCHOWITZ, SAYING: "I think we'll see brinkmanship on both sides until the last moment. Whether the 24th really is the final deadline is highly questionable. We still think it is in the interests of both sides to find a compromise, but it looks at the moment that Greece is going to have to concede substantially more than the rest of the euro zone." Greece will likely be on the agenda at Wednesday's ECB meeting too. The central bank is expected to discuss further funding for Greek banks. Poor relations between Greece and its euro zone peers is casting a shadow of uncertainty over the bloc. But the potential impact of a Grexit is being played down. (SOUNDBITE) JP MORGAN MARKET STRATEGIST, PATRIK SCHOWITZ, SAYING: "The probability of Greece leaving the euro zone is probably at the highest we've seen since the start of the crisis, but given that markets haven't really reacted to it, it is really that markets have discounted much of an impact from a possible Greek exit. And that is probably driven by the fact that the ECB is really minimizing the risk of contagion to other peripheral bond markets and also the european banking system's exposure to Greece has been massively reduced and is pretty small now." ECB Chief Mario Draghi is also expected to address the euro zone's improving prospects. The bank's actions have created an environment for growth. The euro is at a 12-year low, buoying exporters. Euro zone industrial production surged in February much more than expected. And euro zone banks expect strong demand for loans from companies and home buyers in the coming months as the ECB's money printing improves funding conditions With data pointing to a turnaround, some financial market traders are asking when and how the ECB might start scaling down its stimulus. That may still be some way off.