RPT-GLOBAL ECONOMY WEEKAHEAD-Pick-up continues as Greek drama plays on
(Updates and repeats Sunday's story)
By Jonathan Cable
LONDON, June 7 (Reuters) - Economic indicators are this week expected to show signs of continued, if modest, progress in much of the world -- all of which could be blown off course if the standoff between Greece and its lenders leads to a rupture in the euro zone.
The currency bloc has been a millstone around the neck of the world economy since the financial crisis began and the ongoing drama surrounding Greece and its ability to repay its debts has added to that burden.
The Greek crisis figured prominently in initial talks among leaders at a G7 summit that began on Sunday in Germany. Athens delayed a key debt payment to the International Monetary Fund on Friday, branding as "absurd" the terms of a proposed aid deal from lenders.
European Commission President Jean-Claude Juncker voiced exasperation with Prime Minister Alexis Tsipras, reaffirming a so-called "Grexit" was not being considered, but stressing he could not "pull a rabbit out of a hat" to prevent it if Greece made no effort to reform its public finances.
"Greece's continued resistance to its creditors' demands on key sticking points like pensions, coupled with the missing of Friday's IMF payment, suggests that the risks of a Greek euro exit are still climbing," said Jonathan Loynes, chief European economist at Capital Economics.
Other issues on the agenda at the G7 summit in Bavaria are global growth, climate change and the ongoing sanctions against Russia over the Ukraine crisis.
After positive job data from the U.S. on Friday focus this week will be on the European countries releasing industrial production numbers -- largely expected to show accelerating output -- and revised GDP numbers which are likely to confirm euro zone economic growth was subdued at the start of the year. Continuación...