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The financial markets were relieved last Thursday when Greece announced it was effectively able to repay 450M EUR in debt it owed to the International Monetary Fund. The international financial markets had been speculating for weeks whether or not Athens would be able to meet its debt repayment commitments as the government’s treasury is running on fumes.

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The market deliberately chose to ignore the fact that Greece was only able to repay the 450M EUR because it quickly sold 1.1B EUR in short term bonds less than 24 hours before the repayment was due. Indeed, Athens was able to raise cash by issuing new government bonds that are maturing in just six months time. Whereas half of the countries of the Eurozone (including dodgy countries like Spain) are able to issue such bonds at a negative yield, Greece still had to cough up a yield of 2.97% to secure the short term funding which actually is a very fair price to pay for a country that’s almost bankrupt.

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Greece is just buying some time and the April payment was just a  minor test as a repayment of just 450M EUR isn’t exactly a huge hurdle. The month of May will be much more important as the country will have to find a way to refinance 2.8B EUR of debt on top of repaying approximately 750M EUR to the International Monetary Fund as well as in excess of 300M EUR in interest payments. Long story short, Greece has less than 6 weeks to find 4B EUR in funding. A part of this could be refinanced on the open market but this will very likely have to happen at an interest rate that might strangle Greece and would just mean the death spiral will take a bit longer than originally expected

This also means the country will have to make a decision between either completely defaulting (and leaving the Eurozone) or accepting more help in the form of yet another rescue package. That’s the main reason why Greece’s ridiculous attempts at playing hardball with the Eurozone leaders is just a final spasm before bowing the head and accepting the renewed bailout terms. Even though prime minister Tsipras was in Moscow just days ago, it doesn’t mean Greece is searching for a white knight in Putin as it’s unlikely Russia will be able to provide as much support as Greece would mean. The quick visit was probably just another negotiation technique to try to twist Berlin’s arm, just like Greece’s official request to Germany to pay its war debt of almost 300B EUR (which is  coincidentally almost the entire debt position of the country).

The clock is ticking for Greece and the end game is just weeks away.