European Central Bank Executive Board member Benoit Coeure has said Greece's future in the euro area is not guaranteed, though he still sees room for a political deal to keep it.

He said the market reaction to the Greek referendum had been relatively mild, and that the ECB is ready to use all available instruments, and even some new ones, if needed. Mr Coeure said the ECB will maintain so-called Emergency Liquidity Assistance for lenders "until further notice," though policy makers will keep reviewing the funds. Shares across Europe fell yesterday, but not as much as had been expected; and while borrowing costs rose for Spain and Portugal, they fell for Ireland.

Davy's Donal O'Mahony said that yesterday was an interesting day on the world markets. Mr O'Mahony said that obviously the breakdown of talks and the calling of a referendum came as a shock to the system and it was clear that there would be some reaction from markets. But the reaction across both stock markets and bonds was quite limited, which Mr O'Mahony said reflected the lack of contagion channels that we have now compared to three years ago. And while peripheral bond yields moved higher, core bond yields actually went down. Irish yields remained unchanged yesterday, which he said reflected the country's new found status as a "semi-core credit", adding that the country has made a lot of progress in the last three years to improve our credit worthiness. 

Describing the Greek government's decision overnight that it will not be making its €1.5 billion loan repayment to the IMF as unprecedented for a developed nation in an IMF programme, Mr O'Mahony said it is a hammer blow for the Greek people. But he says the decision will not trigger any accelerated repayment request by Greece's other Troika creditors, while it won't signal the cessation of ELA support for the banks from the ECB. For the moment, the decision will be taken "on the chin" by markets and by the institutions, he stated. 

A referendum has been called for  Sunday, which may or may not happen, and Mr O'Mahony said that the terminology has yet to be determined but it will be perceived on the ground as a vote for or against monetary union. In that respect the opinion polls are on the money in suggesting that it would be carried, he predicts. If that happens, the honourable response would be a change in leadership in the Greek government and perhaps the imposition of some sort of technocrat government pending elections later on this year, he added.

MORNING BRIEFS - House price growth continued in April, May and June with the national asking price rising by 1.7% in the three months, that's up 6.1% on the year. According to the latest house price survey from in Dublin the rate of increase was higher, up 2.3% over the three months, and 10.4% on the year. The average asking price is €202,000, while in Dublin it is €282,000. MyHome says it expects only modest house price growth for the rest of the year, with growth of 10% for the year as a whole. It says cash buyers still account for over 50% of transactions in the housing market. 

*** There was a 10% rise in the number of corporate insolvencies in the three months to the end of June according to figures from Deloitte. The retail industry saw the highest level of corporate insolvencies at 16% or 44 out of 275 overall. 
The figure is sharply down on the same period last year, when 347 companies went out of business.

*** Figures from Hughes Blake suggest 331 jobs were saved through examinership in April, May and June. The Hughes Blake SME Examinership index says that though an economic recovery is increasingly widespread, the weight of legacy debts on balance sheets is continuing to force many SMEs to seek to restructure through examinership.

*** Amazon will start a business loan programme for small sellers in the UK today, and is looking to launch it this year in seven more countries including China. Until now, the online retailer has offered the service only in the US and Japan. Amazon Lending, founded in 2012, plans to offer short-term working capital loans in other countries where it operates a third-party, seller-run marketplace business.