LONDON (Dow Jones)–The European Financial Stability Facility holds its first six-month treasury bill auction Tuesday, testing the market a day after being downgraded by Standard and Poor’s. EFSF’s downgrade followed the downgrade of credit ratings of nine European countries backing it, including France. The loss of its prized triple-A credit rating could limit the fund’s borrowing capacity at a time when large euro-zone economies, such as Italy, are seen as needing external assistance with their funding requirements.
Meanwhile, deadlocked Greek debt-rescheduling negotiations threaten to delay key talks for a critical bailout package set for early next week, with officials warning of a rising risk of default unless a breakthrough comes soon.
A senior delegation from the International Monetary Fund, the European Union and the European Central Bank is to arrive in Athens Friday to discuss Greece’s second rescue program. Equally important is a meeting of European finance ministers in Brussels next Monday to formulate their portion of the next Greek bailout, set in October at EUR130 billion.
But before then, the Greek government needs to wrap up talks seeking a 50% write-down on its debt owed to creditor banks , which have been stalled due to differences with private sector creditors over the coupon on new Greek bonds.
This is the known worry list:
–Tuesday: Spanish, Greek T-bill auctions. German January ZEW economic sentiment indicator. Three months since Moody’s began review of France’s “stable” rating outlook. EFSF 6-month T-bill auction.
–Wednesday: ECB seven-day dollar operation. Portuguese T-bill auction. German bond auction. Greece likely to resume talks with private sector creditors on debt writedown.
–Thursday: Spanish, French bond auctions.
–Friday: Troika of international inspectors expected to return to Greece to resume talks on new bailout deal. Ireland’s troika of lenders releases its latest quarterly review of the country’s bailout. Sarkozy, Merkel meet Mario Monti in Italy (meeting may be postponed, officials now say.)
–Sunday, Jan. 22: Finnish presidential election, first round.
–Monday, Jan. 23: Euro-zone finance ministers meet. French January business sentiment index.
–Tuesday, Jan. 24: European Union finance ministers meet. Spanish T-bill auction. Flash euro-zone January PMI data.
–Wednesday, Jan. 25: Preliminary data on the Spanish government’s annual budget deficit expected around this time. German January Ifo business climate index. ECB seven-day dollar operation. ECB three-month long-term refinancing operation. German bond auction. World Economic Forum begins in Davos, Switzerland (through Jan. 29).
–Thursday, Jan. 26: Italian bond auction. EUR45 billion of 3-month ECB LTRO funds mature.
–Friday, Jan. 27: Italian T-bill auction.
–Monday, Jan. 30: EU leaders’ summit. Italian, Belgian bond auctions.
–Tuesday, Jan. 31: Greece aims to conclude talks detailing new EUR130 billion loan deal, debt-exchange program with private-sector creditors by this date.
–Wednesday, Feb. 1: EUR25.8 billion of Italian BTP bonds due. Portuguese T-bill auction. German bond auction. Euro-zone January manufacturing PMI data.
–Thursday, Feb. 2: French bond auction. –Friday, Feb. 3: Euro-zone January services PMI data.
–Monday, Feb. 6: Italian parliament must have approved government’s fiscal, growth package by this date.
–Wednesday, Feb. 8: German bond auction.
–Thursday, Feb. 9: ECB interest-rate statement, press conference.
–Friday, Feb. 10: EUR1.0 billion in Greek debt maturing.
–Monday, Feb. 13: Italian T-bill auction.
–Tuesday, Feb. 14: Italian BTP auction. Greek T-bill auction. German February ZEW economic sentiment indicator.
–Wednesday, Feb. 15: Portuguese T-bill auction. Flash data on 4Q EU gross domestic product.
–Thursday, Feb. 16: French bond auction.
–Friday, Feb. 17: EUR1.6 billion Greek T-bills maturing.
–Monday, Feb. 20: Euro-zone finance ministers meet. Flash euro-zone February PMI data.
–Tuesday, Feb. 21: European Union finance ministers meet. Greek T-bill auction.
–Wednesday, Feb. 22: German bond auction.
–Thursday, Feb. 23: German February Ifo business climate index.
–Friday, Feb. 24: Italian bond auction.
–Saturday, Feb. 25: Group of 20 finance ministers, central-bank governors meet.
–Monday, Feb. 27: Belgian bond auction, Italian T-bill auction.
–Tuesday, Feb. 28: ECB three-month, three-year long-term refinancing operation. Italian bond auction.
–Wednesday, Feb. 29: EUR10.6 billion of Italian CTZ bonds mature. German bond auction.
–Thursday, March 1: EUR14.9 billion of Italian BTP and EUR12.3 billion CCT bonds mature.
–Thursday, March 1-Friday, March 2: EU leaders summit.
-By Jenny Paris and William Kemble-Diaz, Dow Jones Newswires; 44-20-78429347; email@example.com
–Emese Bartha, David Roman, Neelabh Chaturvedi, Alkman Granitsas, Patricia Kowsmann and Eamon Quinn contributed to this article.